Suzano Papel E Celulose S.A. Suzano S.A

Suzano S.A.

Suzano Papel e Celulose S.A. Unaudited condensed consolidated interim financial information as of September 30, 2019 and Report on Review of Interim Financial Information

Report on review of interim financial information

To the Board of Directors and Shareholders Suzano S.A.

Introduction

We have reviewed the accompanying condensed consolidated interim balance sheet of Suzano S.A. and its subsidiaries (the “Group”) as of September 30, 2019 and the related condensed consolidated interim statements of income (loss) and comprehensive income (loss) for the three and nine-month period then ended, and the condensed consolidated interim statements of changes in equity and cash flows for the nine-month period then ended and notes, comprising a summary of significant accounting policies and other explanatory notes.

Management is responsible for the preparation and presentation of this condensed consolidated interim financial information in accordance with International Accounting Standard (IAS) 34 - Interim Financial Reporting, of the International Accounting Standards Board (IASB). Our responsibility is to express a conclusion on this condensed consolidated interim financial information based on our review.

Scope of review

We conducted our review in accordance with Brazilian and International Standard on Reviews of Interim Financial Information (NBC TR 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial information is not prepared, in all material respects, in accordance with International Accounting Standard (IAS) 34 - Interim Financial Reporting, of the International Accounting Standards Board (IASB).

Emphasis of matter

We draw attention to Note 2.2 to these condensed consolidated interim financial information, where it is described that the condensed consolidated interim financial information as of September 30, 2019 is not comparable with the consolidated financial statements as of December 31, 2018 and with the condensed consolidated interim financial information as of September 30, 2018. This is due to the conclusion of the business combination with Fibria Celulose S.A. ("Fibria") on January 3, 2019 (Note 1) and the subsequent merger of Fibria by Suzano at April 1, 2019. Our conclusion is not qualified in respect of this matter.

São Paulo, October 30, 2019

PricewaterhouseCoopers José Vital Pessoa Monteiro Filho Auditores Independentes Contador CRC 1PE016700/O-0 CRC 2SP000160/O-5

Suzano S.A.

Unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Condensed Consolidated Interim Balance Sheet

September 30, December 31, Note ASSETS 2019 2018 CURRENT

Cash and cash equivalents 5 3,714,646 4,387,453

Financial investments 6 4,897,585 21,098,565

Trade accounts receivable 7 2,058,731 2,537,058

Inventories 8 6,258,364 1,853,104

Recoverable taxes 9 1,235,668 296,832

Derivative financial instruments 4 239,161 352,454

Advances to suppliers 138,127 98,533

Assets held for sale 5,718 Other assets 279,096 169,175 Total current assets 18,821,378 30,798,892

NON-CURRENT

Recoverable taxes 9 557,373 231,498 Financial investments 6 177,453

Deferred taxes 11 3,083,218 8,998

Derivative financial instruments 4 677,305 141,480

Advances to suppliers 1,100,257 218,493

Judicial deposits 338,971 129,005

Other assets 201,374 93,935

Biological assets 12 10,280,967 4,935,905

Investments 13 279,263 14,338

Property, plant and equipment 14 41,500,872 17,020,259 Right of use 18.1 4,359,907

Intangible 15 17,968,738 339,841

Total non-current 80,525,698 23,133,752

TOTAL ASSETS 99,347,076 53,932,644

The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.

Suzano S.A.

Unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Condensed Consolidated Interim Balance Sheet

September 30, December 31, LIABILITIES Note 2019 2018 CURRENT Trade accounts payable 16 3,325,724 632,565 Loans, financing and debentures 17.1 5,091,236 3,426,696 Lease liabilities 18.2 587,910 Derivative financial instruments 4 1,111,477 596,530 Taxes payable 212,378 243,835 Payroll and charges 439,615 234,192 Liabilities for assets acquisitions and subsidiaries 92,098 476,954 Dividends payable 9,904 5,434 Advance from customers 31,925 75,159 Other liabilities 278,615 367,313 Total current liabilities 11,180,882 6,058,678

NON-CURRENT Loans, financing and debentures 17.1 58,929,307 32,310,813 Lease liabilities 18.2 3,946,474 Derivative financial instruments 4 2,865,034 1,040,170 Liabilities for assets acquisitions and subsidiaries 463,835 515,558 Provision for judicial liabilities 19 3,495,447 351,270 Employee benefits 20 592,467 430,427 Deferred taxes 11 589,148 1,038,133 Share-based compensation plans 21 126,425 124,318 Other liabilities 121,798 37,342 Total non-current liabilities 71,129,935 35,848,031 TOTAL LIABILITIES 82,310,817 41,906,709

EQUITY 22 Share capital 9,235,546 6,241,753 Capital reserves 6,419,941 674,221 Treasury shares (218,265) (218,265) Retained earnings reserves 3,081,740 2,992,590 Other reserves 2,348,132 2,321,708 Retained earnings (loss) (3,947,403) Controlling shareholder´s 16,919,691 12,012,007 Non-controlling interest 116,568 13,928 Total equity 17,036,259 12,025,935 TOTAL LIABILITIES AND EQUITY 99,347,076 53,932,644

The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.

Suzano S.A.

Unaudited condensed consolidated interim financial information

(In thousands of R$, unless otherwise stated)

Condensed Consolidated Interim Statements of Income (Loss)

Third quarter 9 months YTD July 1 to July 1 to September 30, September 30, September 30, September 30, Note 2019 2018 2019 2018

NET SALES 25 6,599,909 4,005,524 18,963,990 10,214,225 Cost of sales 27 (4,986,414) (1,963,077) (14,933,426) (5,231,572) GROSS PROFIT 1,613,495 2,042,447 4,030,564 4,982,653

OPERATING INCOME (EXPENSES) Selling 27 (469,014) (160,988) (1,367,298) (433,250) General and administrative 27 (278,976) (198,576) (887,772) (549,596) Income from associates and joint ventures 13 15,678 3,990 21,247 3,867 Other, net 27 116,132 47,136 268,447 36,597 OPERATING PROFIT BEFORE NET FINANCIAL INCOME (EXPENSES) 997,315 1,734,009 2,065,188 4,040,271

NET FINANCIAL INCOME (EXPENSES) 24 Financial expenses (1,058,484) (475,378) (3,123,771) (1,035,172) Financial income 108,143 133,722 393,374 215,456 Derivative financial instruments (1,857,397) (1,367,075) (2,236,904) (3,848,539) Monetary and exchange variations, net (3,685,540) (254,257) (3,383,054) (1,421,714) NET INCOME (LOSS) BEFORE TAXES (5,495,963) (228,979) (6,285,167) (2,049,698)

Current income taxes 11 (30,414) (97,275) (221,992) (420,147) Deferred income taxes 11 2,066,142 218,646 2,517,641 1,327,747 NET INCOME (LOSS) FOR THE PERIOD (3,460,235) (107,608) (3,989,518) (1,142,098)

Attributable to Controlling shareholders’ (3,460,810) (107,780) (3,987,065) (1,142,856) Non-controlling interest 575 172 (2,453) 758

Earnings (loss) per share 23

Basic (2.56504) (0.09854) (2.95508) (1.04524)

Diluted (2.56504) (0.09854) (2.95508) (1.04524)

The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.

Suzano S.A.

Unaudited condensed consolidated interim financial information

(In thousands of R$, unless otherwise stated)

Condensed Consolidated Interim Statements of Comprehensive Income (Loss)

Third quarter 9 months YTD July 1 to July 1 to September 30, September 30, September 30, September 30, 2019 2018 2019 2018 Net income (loss) for the period (3,460,235) (107,608) (3,989,518) (1,142,098)

Items that will not be reclassified to profit

or loss Exchange rate variation and fair value on financial assets measured at fair value through of comprehensive income Ensyn Corporation (“Ensyn”) (1) 3,156 CelluForce Inc. (“CelluForce”) 1,406 1,938 Spinnova Oy (“Spinnova”) (1) (840) (1,242) Tax effect of the above items (193) (1,310) 373 2,542

Item that may be subsequently reclassified

to profit or loss Exchange variation on conversion of financial statements and on foreign investments 66,938 36,964 58,525 176,150 66,938 36,964 58,525 176,150 Total comprehensive income (loss) (3,392,924) (70,644) (3,928,451) (965,948)

Attributable to Controlling shareholders’ (3,393,499) (70,816) (3,925,998) (966,706) Non-controlling interest 575 172 (2,453) 758

1) In 2019 the Company revaluated the investment, previously classified as financial investment measured through other comprehensive income, note 3.1.5. and 3.1.6.

The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.

Suzano S.A.

Unaudited condensed consolidated interim financial information Nine-month period ended September 30, 2019

(In thousands of R$, unless otherwise stated)

Condensed Consolidated Interim Statements of Changes in Equity

Share capital Capital reserves Retained earnings reserves Share Share Reserve for Special Retained Non- Share issuance Stock options issuance Tax Treasury Tax Legal capital statutory Dividends Other earnings controlling capital costs granted costs incentives Other shares incentives Reserve increase reserve proposed reserves (loss) Total interest Total equity Balances at December 31, 2017 6,241,753 14,237 (15,442) 396,006 (241,088) 406,898 2,281,328 234,591 2,298,328 11,616,611 11,616,611 Total comprehensive income Net income for the period (1,142,856) (1,142,856) 758 (1,142,098) Other comprehensive income for the period 176,150 176,150 176,150 Transactions with shareholders Stock options granted 72 72 72 Sold of treasury shares 8,514 8,514 8,514 Non-controlling interest 14,379 14,379 Internal changes in equity Partial realization of deemed cost, net of taxes (55,560) 55,560 Stock option exercised (14,309) 14,309 Transfer between reserves 3,230 359 3,589 3,589 Dividends (29,977) (29,977) (29,977) Balances at September 30, 2018 6,241,753 (15,442) 396,006 (218,265) 406,898 2,254,581 234,950 2,418,918 (1,087,296) 10,632,103 15,137 10,647,240

Balances at December 31, 2018 6,241,753 5,100 (15,442) 684,563 (218,265) 422,815 1,730,629 242,612 596,534 2,321,708 12,012,007 13,928 12,025,935 Total comprehensive income Net (loss) for the period (3,987,065) (3,987,065) (2,453) (3,989,518) Other comprehensive income for the period 61,067 61,067 61,067 Transactions with shareholders Share capital increase (note 1.1.1.1 and 22.1) 3,027,528 3,027,528 3,027,528 Share issuance costs (1) (33,735) 15,442 (18,294) (18,294) Stock options granted 3,956 3,956 3,956 Non-controlling interest arising from business combination 105,093 105,093 Unclaimed dividends forfeited 1,122 1,122 1,122 Dividends paid (note 22.2) (596,534) (596,534) (596,534) Internal changes in equity Transfers of tax incentives (684,563) 684,563 Partial realization of deemed cost, net of taxes (39,662) 39,662 Realization of asset revaluation reserve 5,019 5,019 5,019 Issue of common shares related to business combination (note 1,1,1,1) 6,410,885 6,410,885 6,410,885 Balances at September 30, 2019 9,269,281 (33,735) 9,056 6,410,885 (218,265) 684,563 422,815 1,731,751 242,612 2,348,132 (3,947,403) 16,919,691 116,568 17,036,259

1) In 2019, the Company reclassified the share issuance costs from capital reserve to share capital.

The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.

Suzano S.A.

Unaudited condensed consolidated interim financial information Nine-month period ended September 30, 2019

(In thousands of R$, unless otherwise stated)

Condensed Consolidated Interim Statements of Cash Flows

September 30, September 30, 2019 2018 OPERATING ACTIVITIES Net income (loss) for the period (3,989,518) (1,142,098) Adjustment to: Depreciation, depletion and amortization (note 27) 2,879,183 1,175,272 Amortization of fair value adjustment on business combination with Fibria/Facepa/Ibema (note 27) 3,326,974 Amortization of right of use (note 27) 106,925 Amortization of fair value adjustment on business combination with Fibria classified at

financial results (note 24) (69,397) Interest expense on lease liabilities 153,061 Results from sale, disposals and provision for losses (impairment) of property, plant and equipment and biological assets, net (note 27) 26,281 17,438 Income from associates and joint ventures (21,247) (3,867) Exchange rate and monetary variations, net (note 24) 3,383,054 1,655,901 Interest expenses with financing and loans, debentures and debentures, net 2,528,303 661,472 Accrual of interest on financial investments (290,303) (160,636) Amortization of fundraising costs (notes 17.2) 172,803 Derivative (gains) losses, net (note 24) 2,236,904 3,848,539 Fair value adjustment of biological assets (note 12) (83,453) (5,954) Deferred income tax and social contribution expenses (note 11.1) (2,517,641) (1,327,747) Tax credits - gains in tax lawsuit (ICMS from the PIS/COFINS calculation basis) (note 9) (128,115) Interest on employee benefits (note 20.2) 38,762 25,851 Provision/ (Reversal) for judicial liabilities (21,858) 8,990 Expected credit losses, net (note 7.3) (14,364) 6,433 Estimated loss in inventories, net (note 8.1) 30,790 (23,140) Provision for loss of ICMS credits, net 87,496 Reversal of/(addition to) provision for discounts 28,978 Other (6,861) 156,718 Decrease (increase) in assets Trade accounts receivable 2,015,294 (395,989) Inventories (343,929) (288,324) Recoverable taxes 137,786 52,700 Other assets 153,399 (115,955) Increase (decrease) in liabilities Trade accounts payables (726,528) 21,721 Other taxes and contributions paid (389,467) Taxes payable 263,662 751,758 Payroll and charges (196,046) 117,780 Other liabilities (434,601) (64,755) Cash provided by operations, net 8,696,816 4,611,619 Payment of interest with financing and loans and debentures (2,362,331) (662,497) Interest received from financial investments 354,536 Payment of income taxes (336,480) (249,476) Cash provided by operating activities 6,352,541 3,699,646 INVESTING ACTIVITIES Cash provided by the merger of subsidiary 21,431 Additions to property, plant and equipment (note 14) (1,622,068) (899,692) Additions to intangible assets (note 15) (12,816) (6,350) Additions to biological assets (note 12) (2,109,268) (840,223) Proceeds from sale of assets 153,739 44,131 Increase of capital in subsidiaries and associates (45,856) Financial investments 20,428,121 (9,472,426) Advance for acquisition of wood from operations with development (294,162) (3,165) Acquisition of subsidiaries, net cash (note 1.1.1.2) (26,002,540) (315,904) Other investments (265) Cash used in investing activities, net (9,505,115) (11,472,198) FINANCING ACTIVITIES Proceeds from loans, financing and debentures (note 17.2) 16,315,910 13,253,000 Payment of derivative transactions (note 4.4.4) (55,997) (1,263,050) Payment of loans, financing, debentures (note 17.2) (12,249,522) (3,473,928) Payment of leases (note 18.2) (425,297) Payment of dividends (601,735) (210,205) Proceeds from own shares 8,514 Liabilities for assets acquisitions and subsidiaries (470,396) (70,666) Others financing 4,575 Cash provided by financing activities, net 2,517,538 8,243,665 Exchange variation on cash and cash equivalents (37,771) 157,816 Increase (reduction) in cash and cash equivalents (672,807) 628,929 Cash and cash equivalents at the beginning for the period 4,387,453 1,076,833 Cash and cash equivalents at the end for the period 3,714,646 1,705,762 Statement of increase (reduction) in cash and cash equivalents (672,807) 628,929

The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

1 Company Information

Suzano S.A., (current corporate name of Suzano Papel e Celulose S.A., as approved by Extraordinary General Meeting hold on April 1st, 2019), together with its subsidiaries (“Suzano” or collectively “Company”), is a public company with its headquarters office in the city of Salvador, State of Bahia, Brazil.

Suzano owns shares traded in B3 S.A. (“Brasil, Bolsa, Balcão - “B3”), listed on the New Market under the ticker SUZB3. On December 10, 2018, Suzano began trading its American Depositary Receipts ("ADRs") in a ratio of 1 (one) common share, Level II, traded in the New York Stock Exchange under the ticker SUZ, pursuant to a program approved by the Brazilian Securities and Exchange Commission (“CVM”).

After the conclusion of business combination with Fibria Celulose S.A. (“Fibria”), on January 14, 2019, the Company now holds 11 industrial units, located in Aracruz (Espírito Santo, State), Belém (Pará, State), Eunápolis (Veracel Celulose S.A. “Veracel” a joint operation with Stora Enso Amsterdam) and Mucuri (Bahia, State), Fortaleza (Ceará, State), Imperatriz (Maranhão, State), Jacareí, Limeira, Rio Verde and Suzano (São Paulo, State) and Três Lagoas (Mato Grosso, State).

These units produce hardwood pulp from eucalyptus, paper (coated paper, paperboard, uncoated paper and cut size paper) and packages of sanitary paper (consumer goods - tissue) to serve the domestic and foreign markets.

Pulp and paper are sold in the foreign market directly by Suzano, as well as through its subsidiaries in Argentina, the United States of America, Switzerland and Austria and its sales offices in China.

The Company's corporate purpose also includes the commercial operation of eucalyptus forest for its own use, the operation of port terminals, and the holding of interest, as partner or shareholder, in any other company or project, and the generation and sale of electricity.

The Company is controlled by Suzano Holding S.A., through a Voting Agreement whereby it holds 45.84% of the common shares of its share capital.

This unaudited condensed consolidated interim financial information was approved by the Management Company’s on October 30, 2019.

1.1 Major events in the period

1.1.1 Business Combination with Fibria

On January 3, 2019, acquisition date of control by Suzano, after all fulfilled conditions for the conclusion of business combination and shareholding base, Fibria’s shares were exchanged for Suzano’s shares and on January 14, 2019, Suzano concluded the

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

corporate reorganization process, following the terms of the Agreement signed by both entities on March 15, 2018.

The transferred consideration by Suzano for acquisition of control of Fibria, defined in terms of the Agreement, was as follows:

1.1.1.1 Share exchange ratio

On January 2, 2019, according to Notice to Shareholders, the exchange ratio of the common shares issued by Eucalipto Holding S.A. (“Holding”) held by Fibria’s shareholders for shares issued by Suzano was adjusted from 0.4611 to 0.4613, being the exchange ratio of 0.4613 considered as final. The adjustment in the exchange ratio, compared to the originally announced, was due to (i) a change in the total number of shares issued by Fibria ex-treasury and disregarding the shares resulting from the vesting of option plans between those in the Protocol and Justification and that date of 553,080,611 shares for 553,733,881 shares and (ii) alteration of the number of shares issued by Suzano ex-treasury and disregarding the shares resulting from the vesting of option plans between that contained in the Protocol and Justification and that present date of 1,091,984,141 shares to 1,093,784,141 shares.

As consequence of this adjustment, (i) Suzano issued, as a result of the merger of the Holding, 255,437,439 new common shares in the market value of R$ 36.95, totaling amount of R$ 9,438,413, of which R$ 3,027,528 was recognized as capital increase and R$ 6,410,885, as capital reserve and (ii) the amount attributed to Suzano's common share to calculate the capital gain, as disclosed in the Notice of Shareholders on November 29, 2018, increased from R$ 15.38 attributed to 0.4611 common share for R$ 15.39 attributed to 0.4613 common share of Suzano.

1.1.1.2 Cash installment

On January 10, 2019, by means of the Notice to Shareholders, the Company communicated the final value of the Adjusted Cash installment, corresponding to the redemption value of each Holding's redeemable preferred share, originally equivalent to R$ 52.50, (i) reduced by the amount of dividends declared by Fibria on December 3, 2018 and paid in Brazil on December 12, 2018 in the amount of R$ 5.03 per share issued by Fibria (ii) plus R$ 2.73, corresponding to the variation of the average daily rate of Brazilian interbank deposits expressed as an annual percentage, based on 252 business days, measured and disclosed daily by B3 ("DI Rate"), between March 15, 2018 and the Expiration Date of the Transaction including January 10, 2019 (including) and January 14, 2019 (including), the DI Rate was estimated at 6.40% per annual, with a total and final amount of R$ 50.20 per share, making up the final amount of the Adjusted Cash Amount of R$ 27,797,441.

The amounts mentioned above are gross, not considering any tax impacts on the payment to Fibria Resident or Non-Resident Shareholders, which are detailed in the Notice to Shareholders disclosed on November 29, 2018.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Suzano performed a valuation analysis of the fair market value of the assets acquired and liabilities assumed of Fibria and, using the total transferred consideration for the Merger, and allocated for such assets and liabilities.

The following table summarizes the preliminary purchase price allocation based on the appraisal report prepared by an independent and specialized entity:

Cash consideration 27,797,441 Issuance of shares by Suzano 9,438,413 Total consideration 37,235,854

Book value of Fibria's shareholders' equity 14,149,004 Write-off of the book value of existing goodwill, net of the deferred income taxes (3,495,077) Mandatory minimum dividends (eliminated from the balance sheet at the date of acquisition) 724,829 Book value of Fibria's shareholders' equity, net of goodwill 11,378,756

Fair value adjustment on business combination with Fibria (assets and liabilities): Inventories 2,178,903 (1) Property, plant and equipment 9,445,315 (2) Customer relationship 9,030,779 (3) Port assets 749,060 (4) Contingent liabilities (2,970,546) (5) Loans and financing (59,921) (6) Taxes recoverable (235,843) (7) Other assets and liabilities, net 368,624 (8) Deferred taxes, net (546,324) (9)

Total impact of fair value 17,960,047 Preliminary goodwill on the expectation of future profitability 7,897,051 (10)

The Company has not yet finalized the valuation of all identifiable assets acquired and liabilities assumed in the business combination with Fibria and therefore some of these amounts are provisional. These amounts may be adjusted as valuations are finalized.

1) Measured considering the balance of finished products based on selling price, net of selling expenses and an accepted margin based on the results achieved in 2018.

2) Determined based on the analysis of market data on comparable transactions and cost quantification, based on the estimate of replacement or replacement value of the assets.

3) In order to determine the fair value adjustment in the customer portfolio, the income approach and the method were used to measure the present value of the income that will be generated during the remaining useful life of the asset. Considering the 5-year history of Fibria's sales data and the churn rate that measures customer satisfaction and customer permanence in the portfolio, the adjustment was measured using estimated discounted cash flows.

4) Fibria has concession contracts and port assets to assist in port operations in Brazil. For fair value measurement of these assets was considered the income approach, the Multi Period Excess Earnings Method (“MPEEM”) method that measures the present value of the income that will be generated during the remaining useful life of the asset and method of direct cost differential.

5) In the business combination, for the contingencies fair value measurement, whose chances of loss were classified as possible and remote, Fibria's Management and its external and independent advisors were considered for their fair values, whose amounts were measured based on the analyzes of Fibria's external lawyers.

6) The adjustment to fair value of loans and financing was measured based on the fair value of the Bonds, based on the quotation of the security in the secondary market, and the adjustment to present value considering the market rate at the base date on December 31, 2018.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

7) For the measurement of the fair value of the taxes to be recovered, the amount to be recovered, discounted to the present value considering the expected Selic rate for the tax period, was considered.

8) In other net assets and liabilities, including supply contracts, accounts receivable and advances to suppliers, the income evaluation methodology, the present value and the direct cost differential were used.

9) Deferred income tax on fair value adjustments of assets of Veracel and Portocel. For the remaining fair value, we did not recognize deferred income taxes liabilities due to Fibria’s Legal Merger in April 2019.

10) Goodwill is attributable to the strong market position and expected future profitability of Fibria in negotiations in the eucalyptus pulp market.

For more information on the business combination refer note 13.4.

1.1.2 Approval of the legal merger of Fibria

On April 1st, 2019, the Company approved in the Extraordinary Shareholders Meeting of Suzano the legal merger of Fibria, wholly-owned subsidiary of Suzano, with the transfer of all its equity to Suzano and its consequent winding up ("Legal Merger"), provided that the share capital of the Company not changed due to the Legal Merger. Because of the Legal Merger, the Suzano succeeded Fibria in all its rights and obligations.

The following table summarizes, the main items balance sheet of Fibria as of March 31, 2019:

ASSETS LIABILITIES CURRENT CURRENT Cash and cash equivalents 29,086 Loans and financing 816,180 Financial investments 2,734,027 Lease liabilities 367,613 Derivative financial instruments 256,675 Trade accounts payable 955,210 Trade accounts receivable 3,572,059 Derivative financial instruments 254,444 Inventories 1,714,560 Payroll and charges 104,246 Recoverable taxes 768,439 Taxes payable 36,057 Other assets 161,238 Related parties 1,179,254 9,236,084 Dividends payable 4,015 Other liabilities 946,099 4,663,118 NON CURRENT NON CURRENT Recoverable taxes 175,559 Loans and financing 8,139,390 Derivative financial instruments 723,084 Derivative financial instruments 678,833 Recoverable taxes 546,234 Lease liabilities 2,542,253 Deferred taxes 1,364,363 Related parties 16,305,560 Advances to suppliers 696,767 Employee benefits 144,557 Judicial deposits 190,533 Provision for judicial liabilities 190,698 Other assets 100,877 Other liabilities 175,934 28,177,225

Biological assets 4,355,102 Investments 9,481,900 Property, plant and equipment 14,633,114 Right of use on lease agreements 2,818,521 TOTAL LIABILITIES 32,840,343 Intangible assets 118,920 35,204,974 Equity 11,600,715

TOTAL ASSETS 44,441,058 TOTAL EQUITY AND LIABILITIES 44,441,058

2 Presentation of the unaudited condensed consolidated interim financial information

2.1 Preparation basis and presentation

The unaudited consolidated condensed interim financial information was prepared and is presented in accordance with the international standard IAS 34 Interim Financial

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Reporting and disclose all the applicable significant information related to the financial information, which is consistent with the information utilized by management in the performance of its duties.

The unaudited consolidated condensed interim financial information was prepared using the historical cost as the basis of value, except for certain financial assets and liabilities and biological assets that are measured at fair value.

2.2 Unaudited condensed consolidated interim financial information

The unaudited condensed consolidated interim financial information was prepared based on the information of Suzano and its subsidiaries on the period ended September 30, 2019, as well as in accordance with consistent accounting practices and policies, except to Futuragene PLC, which period end is August 31, 2019, however, has no material effect in relation to unaudited condensed consolidated interim financial information.

The subsidiaries are consolidated from the date control is obtained until the date that control ceases to exist. For joint operations, the balances of assets, liabilities, revenues and expenses are proportionally recognized in relation to the participation in the joint operation. In the case of joint venture with other companies and associates, these investments are accounted for using the equity method. In relation to associates Ensyn and Spinnova, which period end is August 31, 2019 for interim financial information, has no material effect in relation to unaudited condensed consolidated interim financial information.

In the consolidation process, the balances in the balance sheet and income statement accounts corresponding to the transactions with subsidiaries are eliminated, as well as the unrealized gains and losses and the investments in these subsidiaries and their respective equity accounting results.

The unaudited condensed consolidated interim financial information of the balance Sheet, Statements of Income (loss), Statements of Comprehensive Income (loss), Statements of Changes in Equity and Statements of Cash Flows, as well the corresponding notes to the financial information regarding to the nine-month period ended September 30, 2019, existing on this unaudited condensed consolidated interim financial information are not comparable with the last annual financial statements as at December 31, 2018 and the unaudited condensed consolidated interim financial information for the nine-month period ended September 30, 2018 due to the conclusion of the business combination of Fibria in January 2019, as disclosed in note 1.1 above. During the period from January 1, 2019 to March 31, 2019 Suzano consolidated Fibria's interim accounting information. However, as from April 1, 2019, Fibria was merged into Suzano, as note 1.1.2.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Companies included in the Company’s unaudited condensed consolidated interim financial information:

Interest in capital (%) Type of September 30, December 31, Investee interest 2019 2018 AGFA – Com. Adm. e Participações Ltda. Direct 100% 100%

Asapir Produção Florestal e Comércio Ltda. (1) Direct 100% 50%

Comercial e Agrícola Paineiras Ltda. Direct 100% 100%

Eucalipto Holding S.A. (2) Direct 100%

Facepa - Fábrica de papel da Amazônia S.A. Direct/Indirect 92.8% 92.8%

Fibria Celulose (USA) Inc. Direct 100%

Fibria Terminal de Celulose de Santos SPE S.A. Direct 100%

Fibria Overseas Finance Ltd. Direct 100%

Fibria Overseas Holding KFT. (3)

Fibria Terminais Portuários S.A. Direct 100%

FuturaGene AgriDev Xinjiang Company Ltd Indirect 100% 100% FuturaGene Biotechnology Shangai Company Ltd. Indirect 100% 100% FuturaGene Brasil Tecnologia Ltda. Direct/Indirect 100% 100%

FuturaGene Delaware Inc. Indirect 100% 100% FuturaGene Hong Kong Ltd. Indirect 100% 100% FuturaGene Inc. Indirect 100% 100% FuturaGene Israel Ltd. Indirect 100% 100% FuturaGene Ltd. Indirect 100% 100%

F&E Participações do Brasil Ltda. Direct 100%

F&E Tecnologia do Brasil S.A. Indirect 100%

Gansu FuturaGene Biotech Co. Ltd. Indirect 100% 100% Itacel - Terminal de Celulose de Itaqui S.A. Indirect 100% 100%

Maxcel Empreendimentos e Participações S.A. Direct 100% 100%

Mucuri Energética S.A. Direct 100% 100%

Ondurman Empreendimentos Imobiliários Ltda. Direct/Indirect 100% 100%

Paineiras Logística e Transporte Ltda. Direct/Indirect 100% 100%

Portocel - Terminal Espec. Barra do Riacho S.A. Direct 51%

Projetos Especiais e Investimentos Ltda. Direct 100%

Stenfar S.A. Indl. Coml. Imp. Y. Exp. Direct/ Indirect 100% 100%

Sun Paper and Board Limited (4) 100%

Suzano Áustria GmbH Direct 100% 100%

Suzano Canada Inc. (5) Direct 100%

Suzano International Trade GmbH (6) Direct 100%

Suzano Luxembourg (7) Direct 100% 100%

Suzano Pulp and Paper America Inc. Direct 100% 100%

Suzano Pulp and Paper Europe S.A. Direct 100% 100%

Suzano Trading Ltd. Direct 100% 100%

Suzano Trading International KFT(8) Direct 100%

Veracel Celulose S.A. Joint operation 50%

1) The full control was acquired arising from the business combination with Fibria.

2) Company merged on January 2, 2019, as mentioned in note 1.1.1.1.

3) Company merged on July 5, 2019 by Suzano Trading International KFT.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

4) Company dissolution on June 2, 2019.

5) Corporate name changed on September 30, 2019, former Fibria Innovations Inc.

6) Corporate name changed on August 28, 2019, former Fibria International Trade GmbH.

7) Company in the process of closing its activities, whose legal proceedings will be concluded until the period ending December 31, 2019.

8) Corporate name changed on August 9, 2019, former Fibria Trading International.

On January 21, 2019, Voto – Votorantim Overseas Trading Operations IV Limited (former Fibria’s joint operation) repurchased its shares owned by Fibria.

3 Accounting Policies

The unaudited condensed consolidated interim financial information was prepared using accounting practices consistent with those used in the preparation of the annual financial statements at December 31, 2018, except for the application of the new accounting standards as of January 1, 2019, described below and which the estimated impacts were previously disclosed in the annual financial statements as of December 31, 2018.

The unaudited condensed consolidated interim financial information should be read in conjunction with the annual financial statements of the Company and Fibria for the year ended December 31, 2018, considering that its purpose is to provide an update on the activities, events and significant circumstances in relation to those disclosed in the annual financial statements.

The following accounting practices were not described in the notes to the financial statements of Suzano as of December 31, 2018, but are relevant for this quarter, especially considering the business combination with Fibria, as described in note 1.1.1.

3.1 New Accounting Policies Adopted

3.1.1 Leases – IFRS 16

The Company adopted IFRS 16 as of January 1, 2019.

This standard determines that lessees must recognize future liabilities in their liabilities and their right to use the leased asset for all lease agreements, with exemption allowed to short-term or low-value contracts. Short-term or low-value contracts for the exemption of the standard refers to contracts where the individual value of the assets is lower than U.S.$ 5,000 and maturity date is before 12 months, represented, mainly, by equipment of technology and vehicles. The Company adopted the standard using a modified retrospective approach that does not require the restatement of the comparative balances.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

In adopting IFRS 16, the Company recognized the lease liabilities in relation to the agreements that meet the definition of lease, whose liabilities were measured at the present value of the remaining lease payments, discounted based on the incremental loan rate. Assets associated with the right of use were measured at the amount equal to the lease liability on January 1st, 2019, with no impact on retained earnings.

The Company used the following practical expedients allowed by the standard:

a) The use of a single discount rate for a portfolio of leases with similar characteristics;

b) Leases whose maturity will occur within 12 months of the date of initial adoption of the standard, accounting was as short-term leases directly in the income statement;

c) The accounting of lease payments as expenses in the case of leases for which the underlying asset is of low value;

d) The use of hindsight in determining the lease term, when the agreement contains options to extend or terminate the lease; and

e) The Company excluded initial direct costs of measuring the right to use asset at the date of initial adoption.

The effects of adopting this new standard are set forth in note 18.

3.1.2 Uncertainty over Income Tax Treatments – IFRIC 23

The interpretation is applicable when there are uncertainties as to the acceptance of the treatment by the Fiscal Authority. If acceptance is not likely, the values of tax assets and liabilities should be adjusted to reflect the best resolution of the uncertainty.

The Company has evaluated the changes introduced by this new standard and based on the analysis carried out, did not identify material changes that have an impact on its unaudited condensed consolidated interim financial information, or alter the recognition and measurement of uncertainties about tax treatment of income.

3.1.3 Fair value amortization of subsidiaries

Fair value amortization of assets and liabilities are classified in cost of goods sold, selling, general and administrative expenses, other operating income (expenses) net and financial result, according to the realization of the items that originated them.

3.1.4 Reclassification – Statements of cash flows

The Company made certain reclassifications on its Statements of cash flows regarding the nine-month period ended September 30, 2018, substantially in operating activities,

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

for a better comparison with the Statements of cash flows for the nine-month period ended September 30, 2019.

3.1.5 Revaluation of investment – Ensyn

Ensyn investment was previously classified as financial investment measured through other comprehensive income, however in the second quarter of 2019, based on the shareholders’ agreement and recent capital contribution to Ensyn, the Company increased its stake in this investment and obtained significant influence. Therefore, as from the second quarter of 2019, the Company has recorded its investment prospectively under the equity method using the fair value as deemed cost’ method, with the consequent presentation of the investment under “Investments in subsidiaries, affiliates, joint operations and joint ventures” and no longer under “Other investments”, as disclosed in note 13.2.

Moreover, the Company identified a goodwill based on expected future profitability in the amount of U.S.$ 40,049 (equivalent to R$ 154,578), arising from the difference of the consideration paid of U.S.$ 43,000 (equivalent to R$ 165,928) and the carrying amount of the net assets of the investee of U.S.$ 2,941 (equivalent to R$ 11,350).

3.1.6 Revaluation of investment – Spinnova Oy

Spinnova investment was previously classified as financial investment measured through other comprehensive income, however in the third quarter of 2019, based on the shareholders’ agreement and recent capital contribution to Spinnova, the Company increased its stake in this investment and obtained significant influence. Therefore, as from the third quarter of 2019, the Company has recorded its investment prospectively under the equity method using the fair value as deemed cost’ method, with the consequent presentation of the investment under “Investments in subsidiaries, affiliates, joint operations and joint ventures” and no longer under “Other investments”, as disclosed in note 13.2.

3.1.7 Biological assets

Considering that Suzano used different assumptions to the biological assets fair value measurements that Fibria prior to the acquisition, in the first measurement after business combination, the Company reviewed its assumption for “effective planting area”, keeping the immature forest (up to 2 years from the date of planting) at historical cost. As a result of the Management’s considers that during this period, the historical cost of biological assets approximates to its fair value. Additionally, the purpose of this change is to reflect the experience acquired in the biological assets measurements process and the alignment of calculation approach with the Company’s forest management, which perform continuous forest inventories for the purpose of estimating the wood stock or future production forecast, represented by the average annual increment (“IMA”), from the 3rd year of planting.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Considering the fact that in the first two years of forest formation, the historical cost approximates to its fair value, as described above, this assumption alignment did not generate significant impacts on the Company's financial statements.

3.2 New standards, revisions and interpretations not yet in force

There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Company’s condensed consolidated interim financial information.

4 Financial Instruments and Risks Management

4.1 Financial risks management

4.1.1 Overview

In the nine-month period ended September 30, 2019, there were no significant changes in the financial risk management policies and procedures compared to those reported in note 4 to the financial statements of December 31, 2018.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

4.1.2 Rating

All operations with financial instruments are recognized in the Company's interim financial information, as set forth below in the following categories:

September 30, December 31, 2019 2018 Assets Amortized cost Cash and cash equivalents (note 5) 3,714,646 4,387,453 Trade accounts receivable (note 7) 2,058,731 2,537,058 Other assets 480,470 263,110 6,253,847 7,187,621

Fair value through other comprehensive income Other investments (note 13) 20,317 20,317

Fair value through profit and loss Derivative financial instruments (note 4) 916,466 493,934 Financial investments (note 6) 5,075,038 21,098,565 5,991,504 21,592,499 12,265,668 28,780,120 Liabilities Amortized cost Loans, financing and debentures (note 17.1) 64,020,543 35,737,509 Lease liabilities (note 18.2) 4,534,384 Liabilities for assets acquisitions and subsidiaries 555,933 992,512 Trade accounts payable and other liabilities 3,726,137 1,037,220 72,836,997 37,767,241 Fair value through profit and loss Derivative financial instruments (note 4) 3,976,511 1,636,700 3,976,511 1,636,700 76,813,508 39,403,941

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

4.1.3 Fair value of loans and financing

The following is a breakdown of the estimated fair values of loans and financing:

Yield used to September 30, December 31, discount 2019 2018 Quoted in the secondary market

In foreign currency Bonds U.S.$ 30,573,395 15,035,165 Estimated to present value In foreign currency Export credits (“Pre-payment”) LIBOR U.S.$ 16,368,739 12,819,072 Export credits (“Finnvera”) LIBOR U.S.$ 832,907 Export credits (“ACC/ACE”) DI 1 1,941,606 1,732,088 In local currency BNP – Forest Financing DI 1 194,265 BNDES – TJLP DI 1 1,920,960 206,601 BNDES - TLP DI 1 121,922 BNDES – Fixed DI 1 124,853 348,827 BNDES – Selic (“Special Settlement and Custody DI 1 System”) 685,083 BNDES - Currency basket DI 1 62,950 169,243 CRA (“Agribusiness Receivables Certificate”) DI 1 6,002,724 2,383,775 FINAME (“Special Agency of Industrial Financing”) DI 1 15,444 FINEP (“Financier of Studies and Projects”) DI 1 7,032 NCE (“Export Credit Notes”) DI 1 1,410,454 1,501,623 NCR (“Rural Credit Notes”) DI 1 280,902 297,375 Export credits (“Pre-payment”) DI 1 1,414,238 FDCO (“West Center Development Fund”) DI 1 608,681

61,733,248 35,326,676

The Company's Management considers that for its other financial liabilities measured at amortized cost, its book values approximate their fair values and therefore the information on their fair values is not being presented.

4.2 Liquidity risk

The following are the remaining contractual maturities of consolidated financial liabilities at the reporting date. The following amounts are cash flows, are undiscounted and include contractual interest payments and exchange variation, and therefore may not be reconciled with the amounts disclosed in the balance sheet.

September 30, 2019 Total Book Total Future Up to 1 1 - 2 2 - 5 More than 5 Value Value year years years years Liabilities Trade accounts payables 3,325,724 3,325,724 3,325,724 Loans, financing and debentures 64,020,543 93,809,395 7,705,644 7,475,039 31,564,963 47,063,749 Lease liabilities 4,534,384 7,229,985 624,260 642,598 1,659,315 4,303,812 Liabilities for asset acquisitions and subsidiaries 555,933 638,464 104,251 102,315 318,901 112,997 Derivative financial instruments 3,976,511 10,660,001 1,490,662 1,061,740 1,797,840 6,309,759 Other liabilities 400,413 400,413 278,615 121,798 76,813,508 116,063,982 13,529,156 9,403,490 35,341,019 57,790,317

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

December 31, 2018 Total Book Total Future Up to 1 1 - 2 2 - 5 More than Value Value year years years 5 years Liabilities Trade accounts payables 632,565 632,565 632,565 Loans, financing and debentures 35,737,509 54,020,082 5,158,441 4,091,669 18,372,597 26,397,374 Liabilities for asset acquisitions and subsidiaries 992,512 1,099,331 495,862 100,715 316,730 186,023 Derivative financial instruments 1,636,700 2,149,710 790,679 736,715 465,853 156,462 Other liabilities 404,655 404,655 367,314 37,341 39,403,941 58,306,342 7,444,861 4,966,440 19,155,180 26,739,859

4.3 Market risk

4.3.1 Exchange rate risk

The following table set forth the net exposure of assets and liabilities in foreign currency, primarily the U.S. dollar:

September 30, December 31, 2019 2018 Assets

Cash and cash equivalents 2,502,349 1,143,968

Trade accounts receivable 1,179,154 1,661,108

Derivative financial instruments 603,589 493,685

4,285,092 3,298,761

Liabilities

Trade accounts payables (953,473) (72,680)

Loans and financing (46,680,256) (26,384,721)

Liabilities for asset acquisitions and subsidiaries (294,112) (333,049)

Derivative financial instruments (3,976,173) (1,464,569)

(51,904,014) (28,255,019)

Net liability exposure (47,618,922) (24,956,258)

4.3.1.1 Sensitivity analysis – foreign exchange rate exposure – except financial instruments derivatives

For market risk analysis, the Company uses scenarios to jointly evaluate assets and liabilities positions in foreign currency, and the possible effects on its results. The probable scenario represents the amounts already booked, as they reflect the translation into Brazilian Reais on the base date of the balance sheet (R$/U.S.$ = 4.1644).

This analysis assumes that all other variables, particularly, the interest rates, remains constant. The other scenarios considered the appreciation/depreciation of the Brazilian real against the U.S. dollar at the rates of 25% and 50%, before taxes.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

The following table set forth the potential impacts in absolute amounts:

September 30, 2019 Effect on profit and loss and equity Possible Remote Probable (25%) (50%) Cash and cash equivalents 2,502,349 625,587 1,251,175 Trade accounts receivable 1,179,154 294,789 589,577 Trade accounts payable 953,473 238,368 476,737 Loans and financing 46,680,256 11,670,065 23,340,128 Liabilities for asset acquisitions and subsidiaries 294,112 73,528 147,056

4.3.1.2 Sensitivity analysis – foreign exchange rate exposure – financial instruments derivatives

The following table set forth the potential impacts assuming these scenarios:

September 30, 2019 Effect on profit and loss and equity Possible Remote Possible Remote Probable (+25%) (+50%) (-25%) (-50%) 4.1587 5.1984 6.2381 3.1190 2.0794 Financial instruments derivatives Derivative options (491,794) (3,389,379) (7,225,141) 3,093,154 7,013,498 Derivative swaps (2,343,462) (4,149,754) (8,299,508) 4,149,755 8,299,509

4.3.2 Interest rate risk

4.3.2.1 Sensitivity analysis – exposure to interest rates – except financial instruments derivatives

For market risk analysis, the Company uses scenarios to evaluate the sensitivity that variations in operations impacted by the rates: Interbank Deposit Rate (“CDI”), Long Term Interest Rate (“TJLP”), Special System for Settlement and Custody ("SELIC") and the London Interbank Offered Rate (“LIBOR”) may have on its results. The probable scenario represents the amounts already booked, as they reflect the best estimate of the Management.

This analysis assumes that all other variables, particularly exchange rates, remain constant. The other scenarios considered appreciation/depreciation of 25% and 50% in the market interest rates.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

The following table set forth the potential impacts in absolute amounts:

September 30, 2019 Effect on profit and loss and equity

Probable Possible (25%) Remote (50%) CDI Cash and cash equivalents 1,119,950 15,119 30,239 Financial investments 5,075,038 68,513 137,026 Loans and financing 6,053,393 81,720 163,442

TJLP Loans and financing 1,893,887 28,171 56,343

LIBOR Loans and financing 16,174,097 84,313 168,626

4.3.2.2 Sensitivity analysis – exposure to interest rates – financial instruments derivatives

This analysis assumes that all other variables, particularly exchange rates, remain constant. The other scenarios considered appreciation/depreciation of 25% and 50% in the market interest rates.

The following table set forth the potential impacts assuming these scenarios:

September 30, 2019 Effect on profit and loss and equity Probable Remote Probable Remote Probable (+25%) (+50%) (-25%) (-50%) CDI Financial instruments derivatives Liabilities Derivative options (491,794) (63,071) (125,315) 64,078 129,369 Derivative swaps (2,343,462) (47,784) (92,876) 50,632 104,265 Libor Financial instruments derivatives Liabilities Derivative swaps (535,420) 130,631 261,272 (130,621) (261,231)

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

4.3.2.3 Sensitivity analysis for changes in the consumer price index of the US economy

For the measurement of the probable scenario, the United States Consumer Price Index (US-CPI) was considered on September 30, 2019. The probable scenario was extrapolated considering an appreciation/depreciation of 25 % and 50% in the US-CPI to define the possible and remote scenarios, respectively, in absolute amounts.

September 30, 2019 Impact of an increase/decrease of

US-CPI on the fair value Probable Possible (25%) Remote (50%) Embedded derivative in forestry partnership and standing wood supply agreements 311,960 106,112 216,764

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

4.4 Derivative financial instruments

The Company determines the fair value of derivative contracts and recognizes that these amounts may differ from the amounts realized in the event of early settlement. The amounts disclosed by the Company are based on an estimate and using data provided by a third party, measured internally and compared with measurements performed by external consulting.

4.4.1 Outstanding derivatives by type of contract, including embedded derivatives

The positions of outstanding derivatives are set forth below:

Notional value in U.S.$ Fair value September 30, December 31, September 30, December 31, 2019 2018 2019 2018

Instruments contracted with protection strategy Operational Hedge NDF (R$ x U.S.$) 150,000 17,036 Zero Cost Collar (R$ x U.S.$) 3,765,000 3,040,000 (491,794) (134,814)

Debt hedge Interest rate hedge Swap LIBOR to Fixed (U.S.$) 2,753,571 2,757,143 (535,420) (170,707) Swap IPCA to CDI (notional in Reais) 843,845 214,854 Swap IPCA to Fixed (U.S.$) 121,003 (1,909) Swap CDI x Fixed (U.S.$) 3,115,614 2,402,110 (2,446,383) (853,141) Pre-fixed Swap to U.S.$ (U.S.$) 350,000 (111,933)

Hedge de Commodity Swap Bunker (oil) 1,826 5,344 580 (1,140)

Embedded derivative in a purchase of standing wood agreement (1) US - CPI Swap 690,624 311,960 (3,060,045) (1,142,766)

Current assets 239,161 352,454 Non-current assets 677,305 141,480 Current liabilities (1,111,477) (596,530) Non-current liabilities (2,865,034) (1,040,170) (3,060,045) (1,142,766)

1) The embedded derivative refers to the swap for the sale of US-CPI variations within the term of the forest partnership and the provision of standing timber agreements.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

4.4.2 Fair value by maturity schedule

September 30, December 31, 2019 2018 2019 (129,629) (244,069) 2020 (1,063,896) (180,333) 2021 (49,852) 87,851 2022 (252,142) 83,692 2023 87,165 80,052 2024 (273,763) 82,963 2025 (754,472) (486,958) 2026 onwards (623,456) (565,964) (3,060,045) (1,142,766)

4.4.3 Assets and liabilities position of outstanding derivatives

The positions of outstanding derivatives are set forth below:

Notional value Fair value September 30, December 31, September 30, December 31, Currency 2019 2018 2019 2018 Debt hedge Assets Swap CDI x Fixed (U.S.$) R$ 11,498,565 8,722,620 110,242 119,178 Swap Pre-Fixed to U.S.$ R$ (U.S.$) 1,317,226 123,373 Swap Libor x Fixed (U.S.$) U.S.$ 2,753,571 2,757,143 Real IPCA (IPCA x CDI) IPCA 928,546 214,854 Real IPCA (IPCA para U.S.$) IPCA 496,608 3,999 452,468 119,178 Liabilities Swap CDI x Fixed (U.S.$) U.S.$ 3,115,614 2,402,110 (2,556,625) (972,319) Swap Libor x Fixed (U.S.$) U.S.$ 350,000 2,757,143 (235,306) (170,707) Swap Libor x Fixed (U.S.$) U.S.$ 2,753,571 (535,420) Real IPCA (IPCA x CDI) R$ 843,845 Real IPCA (IPCA para U.S.$) U.S.$ 121,003 (5,908) (3,333,259) (1,143,026) (2,880,791) (1,023,848) Operational hedge Zero cost collar (U.S.$ x R$) U.S.$ 3,765,000 3,040,000 (491,794) (134,814) NDF (R$ x U.S.$) U.S.$ 150,000 17,036 (491,794) (117,778) Commodity hedge

Swap Bunker U.S.$ 1,826 5,344 580 (1,140) 580 (1,140) (3,372,005) (1,142,766)

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

4.4.4 Fair value settled amounts

The consolidated positions of settled derivatives were as follows:

September 30, September 30, 2019 2018 Operational hedge Zero cost collar (R$ x U.S.$) (3,288) 1,693 NDF (R$ x U.S.$) 47,565 (998,139) 44,277 (996,446) Commodity hedge Bunker (oil) 3,628 3,628 Debt hedge Swap CDI x Fixed (U.S.$) (92,063) (6,387) Swap IPCA x CDI 23,024 Swap Pre-Fixed to U.S.$ (U.S.$) (26,358) (95,397) (6,387) Interest hedge Swap LIBOR x Fixed (U.S.$) (8,505) (615) (8,505) (615) Total in derivatives (55,997) (1,003,448)

4.5 Capital management

The main objective of Company’s capital Management is to strengthen its capital structure, seeking to maintain an adequate level of leverage, and to mitigate risks that may affect the availability of capital in business development.

The Company monitors constantly significant indicator, such as, consolidated financial leverage ratio, which is the ratio of total net debt to its adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (“Adjusted EBITDA”);

4.6 Fair value hierarchy

In the nine-month period ended September 30, 2019, there were no changes in the criteria of classification of the assets and liabilities in the levels of the fair value hierarchy when compared to the criteria used in the classification of those instruments disclosed in note 4.7 to our most recent annual financial statements as of December 31, 2018, except for Ensyn’s and Spinnova’s investments as disclosed in note 3.1.5. and 3.1.6. There were no transfers between levels 1, 2 and 3 during the periods disclosed.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

September 30

2019

Level 1 Level 2 Level 3 Total Assets Fair value through profit or loss Derivative financial instruments 916,466 916,466 Financial investments 2,911,686 2,163,352 5,075,038 2,911,686 3,079,818 5,991,504

Fair value through other comprehensive income Other investments - CelluForce 20,317 20,317 20,317 20,317

Biological assets 10,280,967 10,280,967 10,280,967 10,280,967 Total assets 2,911,686 3,079,818 10,301,284 16,292,788

Liabilities Fair value through profit or loss Derivative financial instruments (3,976,511) (3,976,511) (3,976,511) (3,976,511) Total liabilities (3,976,511) (3,976,511)

December 31, 2018 Level 1 Level 2 Level 3 Total Assets Fair value through profit or loss Derivative financial instruments 493,934 493,934 Financial investments 14,933,513 6,165,052 21,098,565 14,933,513 6,658,986 21,592,499

Biological assets 4,935,905 4,935,905 4,935,905 4,935,905 Total Assets 14,933,513 6,658,986 4,935,905 26,528,404

Liabilities Fair value through profit or loss Derivative financial instruments (1,636,700) (1,636,700) (1,636,700) (1,636,700) Total Liabilities (1,636,700) (1,636,700)

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

5 Cash and Cash Equivalents

Average yield September 30, December 31, p.a. % 2019 2018 Cash and banks 2.13 2,423,913 1,151,766

Cash equivalents

Local currency (1) Fixed-term deposits 100.19 of CDI 1,119,950 3,215,252

Foreign currency (1) Fixed-term deposits 1.88 170,783 20,435 3,714,646 4,387,453

1) Refers to Time Deposit and Sweep Account applications, maturing up to 90 days.

6 Financial Investments

Average yield September 30, December 31, p.a. % 2019 2018 In local currency

Investment funds 18.75 of CDI 8,005

Private funds 99.42 of CDI 829,658 14,933,513 Public titles Measured at fair value through profit 99.42 of CDI or loss 2,911,687 2,049,281

Private Securities (Compromised) 100.39 of CDI 1,148,235 4,115,771 Private Securities (Compromised) - 102 of CDI Escrow Account (1) 177,453

5,075,038 21,098,565

Current 4,897,585 21,098,565 Non-Current 177,453

1) Refers to the guarantee account recognized by Fibria (merged into by Suzano on April 1st, 2019 note 1.1.2), which will be released only after obtaining the applicable governmental approvals and compliance by the Company with the precedent conditions to the conclusion of the Losango Project provided for in the agreement entered with CMPC Celulose Riograndense SA ("CMPC"). The Losango Project was an operation to buy and sell lands and forests involving Fibria and CMPC, signed in December 2012.

The variation in the balance is substantially related to the payment made for the purchase of Fibria in the amount of R$ 27,797,441, as disclosed in note 1.1.1.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

7 Trade Accounts Receivables

7.1 Breakdown of balances

September 30, December 31, 2019 2018

Domestic customers

Third parties 898,328 853,684 (1) Receivables Investment Fund ("FIDC") 8,704 22,299

Related parties (note 10) 23,727 36,727

Foreign customers

Third parties 1,179,154 1,661,527

(-) Expected credit losses (51,182) (37,179)

2,058,731 2,537,058

1) In 2017, the Company created the Credit Rights Investment Fund ("FIDC"), which is a vehicle with the purpose of acquiring credit rights originated from the sales made by Suzano to facilitate credit to certain customers. The FIDC is an investment fund that acquires receivables and securities representing credit rights. The FIDC has a two-year term which ended in September 30, 2019. The Company has a co-obligation and maintains a substantial credit risk on receivables, so that the Company booked an accounts receivable of R$8,704 and a liability (loan) of R$8,704, note 17.1.

The Company performs factoring transactions for certain customers’ receivables where, substantially all risks and rewards related to these receivables are transferred to the counterpart, so that these receivables are derecognized from accounts receivable in the balance sheet. The impact of these factoring transactions on the accounts receivable in the balance sheet as at September 30, 2019, is R$ 4,490,045 (R$ 396,563 as at December 31, 2018).

7.2 Overdue securities

September 30, December 31,

2019 2018 Overdue Up to 30 days 198,861 291,050

From 31 to 60 days 19,330 54,845

From 61 to 90 days 15,605 10,982

From 91 to 120 days 9,235 7,446

From 121 to 180 days 20,789 6,285

More than 180 days 95,132 47,262 358,952 417,870

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

7.3 Changes in expected credit losses

September 30, December 31, 2019 2018 Beginning balance (37,179) (38,740) Business combination with Fibria (1) (5,947) (Addition)/reversal (16,685) (11,578) Recovered 2,321 5,128 Write-off 6,294 8,993 Exchange rate variation 14 (982) Ending balance (51,182) (37,179)

1) Business combination with Fibria and its subsidiaries held on January 3, 2019, note 1.1.1.

The Company maintains guarantees for overdue securities in its commercial operations, through credit insurance policies, letters of credit and other guarantees. Part of these guarantees cover and therefore, avoid the need to recognize expected credit losses, in accordance with the Company's credit policy.

8 Inventories

September 30, December 31, 2019 2018 Finished goods Pulp Domestic (Brazil) 848,014 167,317 Foreign 3,186,062 485,226 Paper Domestic (Brazil) 268,900 227,303 Foreign 100,261 67,872 Work in process 86,279 52,882 Raw material 1,289,174 626,150 Spare parts and other 479,674 226,354 6,258,364 1,853,104

The change in the consolidated balance is substantially related to the balances arising from the business combination with Fibria in January 2019, as disclosed in note 1.1.1.

On September 30, 2019, inventories are net of estimated losses in the amounts of R$38,193 (December 31, 2018, R$ 33,195).

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

8.1 Changes in estimated losses

September 30, December 31, 2019 2018 Beginning balance (33,195) (51,911) Business combination with Fibria (1) (11,117) Addition (2) (29,118) (10,605) Reversal 2,543 5,873 (3) Write-off 32,694 23,448 Ending balance (38,193) (33,195)

1) Business combination with Fibria and its subsidiaries held on January 3, 2019, note 1.1.1.

2) In the nine-month period ended September 30, 2019, refers, substantially, to estimated losses of inventories of finished goods (paper) and raw material, in the amounts of R$9,791 and R$14,457, respectively.

3) In the nine-month period ended September 30, 2019, refers, substantially, to write-off of spare parts and raw material, in the amounts of R$5,786 and R$18,852, respectively.

During the nine-month period ended September 30, 2019, additional write-offs were booked in the income statement in the amount of R$ 4,216 (December 31, 2018, R$ 29,828).

No inventory items were given as warranty for or guarantee of liabilities for the fiscal years presented.

9 Recoverable Taxes

September 30, December 31, 2019 2018

IRPJ/CSLL – prepayments and withheld taxes 807,001 103,939 PIS/COFINS – on acquisition of property, plant and equipment (1) 282,109 55,518

PIS/COFINS – other operations 435,704 12,426 PIS/COFINS – exclusion ICMS (2) 128,115 (3) ICMS – on acquisition of property, plant and equipment 95,386 78,154 (4) ICMS – other operations 1,422,780 215,361 (5) Reintegra program 116,128 48,879

Other taxes and contributions 17,235 24,845 (6) Provision for the impairment of ICMS credits (1,303,149) (10,792) Fair value adjustment on business combination with Fibria (208,268) 1,793,041 528,330 Current assets 1,235,668 296,832 Non-current assets 557,373 231,498

1) Social Integration Program (“PIS”) and Social Security Funding Contribution (“COFINS”): Credits whose realization is in connection with depreciation period of the corresponding asset.

2) The Company filed legal actions claiming the exclusion of ICMS from the PIS and COFINS contribution tax basis, in relation to certain operations for certain periods starting from March 1992.

Regarding this subject, the Federal Supreme Court (“STF”) initially decided on March 15th, 2017, that ICMS is not included in the tax basis of the aforementioned contributions. The Federal Government made an appeal (“Embargos

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

de Declaração”) in October 2017, requesting the reversal of the Supreme Court’s initial decision among other items. The appeal has yet to be judged.

Based on the Supreme Court’s initial decision and the legal opinion provided by external legal consultants, the Company believes that the probability of the Supreme Court altering its decision is remote. The Company thus started to exclude the ICMS from the tax basis of the referred contributions since August 2018, a practice also supported by court decisions.

For certain PIS and COFINS credits to be recovered, the Company has received final favorable court decisions. In the quarter ended September 30th, 2019, the Company recorded an asset of R$ 128,115 relating to PIS and COFINS tax credits within recoverable taxes and a gain in the statement of income (loss) within other operational results, regarding certain claims for the calculation period from 2006 to July 2018. The Company has estimated the amount attributable to these claims based on the available relevant fiscal documents, and this amount is subject to adjustments to be recorded by management in the future periods.

The Company has additional claims for which a final decision has not been received and for which no asset or gain have been recorded.

3) Tax on Sales and Services (“ICMS”): Credits from the acquisition of property, plant and equipment are recovered on a linear basis over a four year period, from the acquisition date, in accordance with the relevant regulation, ICMS Control on Property, Plant and Equipment (“CIAP”).

4) ICMS credits accrued due to the volume of exports and credit generated in operations of entry of products: Credits are concentrated in the state of Maranhão, Espírito Santo, Bahia and Mato Grosso do Sul, where the Company realizes the credits through sale of credits to third parties, after approval from the State Ministry of Finance. Credits are also being realized through consumption in its consumer goods (tissue) operations in the domestic market that are already operational in Maranhão.

5) Special Regime of Tax Refunds for Export Companies ("Reintegra"): Reintegra is a program that aims to refund the residual costs of taxes paid throughout the exportation chain to taxpayers, to make them more competitive in international markets.

6) Includes the provision for discount on sale to third parties of the accumulated ICMS credit in Maranhão and the provision for full loss of the low probability of realization of the units of Espírito Santo, Bahia and Mato Grosso do Sul due to the difficulty of its realization.

10 Related Parties

The Company's commercial and financial operations with controlling shareholder and Companies owned by controlling shareholder Suzano Holding ("Suzano Group") were carried out at specific prices and conditions regarding values, terms and rates.

In the nine-month period ended September 30, 2019, there were no material changes in the terms of the agreements, deal and transactions entered into, nor were there any new contracts, agreements or transactions of different natures entered into between the Company and its related parties in relation to those disclosed in the annual financial statements of December 31, 2018, except for the transactions involving the Company’s that belonged to the economic group of Fibria, which became related parties of the Company due to the conclusion of the business combination in January 2019, as mentioned in note 1.1.1 and subsequent merger of Fibria by Suzano on April 1st, 2019, note 1.1.2.

10.1 Balances recognized in assets and liabilities Balances receivable (payable)

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

September 30, December 31, Nature 2019 2018 Transactions with controlling shareholders Granting of guarantees and Suzano Holding administrative expenses (37) (125) (37) (125)

Transactions with companies of the Suzano Group and other

related parties

Bexma Reimbursement for expenses 1

Bizma Reimbursement for expenses 1 2

Ecofuturo Social services (33)

Ibema Sale of paper 23,722 36,721 Ibema Purchase of products (3,378) (1,643)

Management Reimbursement for expenses (1) 20,344 35,048

20,307 34,923

Assets

Trade accounts receivable 23,727 36,727

Liabilities Trade accounts payable (3,419) (1,804)

20,307 34,923

10.2 Amounts transacted in the period

Expenses (income) September 30, September 30, Nature 2019 2018

Transactions with controlling shareholders Granting of guarantees and Suzano Holding administrative expenses (4,870) (9,048) (4,870) (9,048)

Transactions with companies of the Suzano Group and other related

parties: Bexma Reimbursement for expenses 5 8 Bizma Reimbursement for expenses 7 14 Ecofuturo Social services (3,419) (1,748) Ibema Sale of paper 95,149 127,926 Ibema Purchase of products (6,107) (7,344) IPFL Reimbursement for expenses 2 3 Lazam - MDS Sale of paper 6 (31) Mabex Aircraft services (freight) (100) (83) Management Reimbursement for expenses (8,841) Nemonorte Real estate advisory 293 (228) 76,995 118,517 72,125 109,469

10.3 Management compensation

Expenses related to the compensation of key management personnel, which include the Board of Directors, Fiscal Council and Board of Statutory Executive Officers, recognized in the statement of income for the period, are set for the below:

September 30, September 30, 2019 2018

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Short-term benefits Salary or compensation 29,217 37,478 Direct and indirect benefits 1,294 2,172 Bonus 8,672 14,150 39,183 53,800 Long-term benefits Share-based compensation plan 41,858 63,530 41,858 63,530

81,041 117,330

Short-term benefits include fixed compensation (salaries and fees, vacation, mandatory bonus and “13th salary” bonus), payroll charges (Company share of contributions to social security – INSS) and variable compensation such as profit sharing, bonus and benefits (company car, health plan, meal voucher, market voucher, life insurance and private pension plan).

Long-term benefits include the stock option plan and phantom shares for executives and key members of the Management, in accordance with the specific regulations (note 21).

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

11 Current and Deferred Taxes

The Company, based on expected generation of future taxable income as determined by a technical study approved annually by Management, recognized deferred tax assets over temporary differences, income and social contribution tax loss carryforwards, which do not expire.

Deferred income and social contribution taxes are originated as follows:

September 30, December 31, 2019 2018

Tax loss 409,615 310,293 Negative tax base 68,561 6,627 Provision for judicial liabilities 249,265 101,667 Operating provisions and other losses 869,719 286,616 Exchange rate variation - Taxation on a cash basis 2,554,583 534,093 Losses on derivatives 1,040,418 388,153 Fair value adjustment on business combination – Amortization 706,200 5,327 Unrealized profit 515,227 227,830 Lease 3,402 6,196 Other temporary differences 4,056 Assets temporary differences 6,416,990 1,870,858

Goodwill - Tax benefit on unamortized goodwill 149,732 13,161 Property, plant and equipment - deemed cost adjustment 1,515,027 1,552,579 Accelerated tax depreciation 1,123,630 1,196,182 Transaction cost 105,475 23,145 Other temporary differences 17,805 2,158 Fair value of biologic assets 38,285 112,768 Tax provision on results of subsidiaries abroad 417,697 Fair value adjustment on business combination with Fibria – Deferred taxes, net 511,710 Tax credits - gains in tax lawsuit (ICMS from the PIS/COFINS calculation basis) 43,559 Liabilities temporary differences 3,922,920 2,899,993

Non-current assets 3,083,218 8,998 Non-current liabilities 589,148 1,038,133

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

The projected realization of assets deferred taxes was prepared based on the Management’s best estimates and on projected results. However, since there are diverse assumptions over which the Company has no control, such as inflation rates, exchange volatility, international market prices and other economic uncertainties in Brazil, future results may differ from those considered in this consolidated projection are set forth below:

October to December 2019 841,676 2020 559,934 2021 790,067 2022 532,410 2023 240,923 2024 776,766 2025 to 2028 2,675,214 6,416,990

The rollforward of net balance of deferred income tax is set for the below:

September 30, December 31, 2019 2018 Beginning balance (1,029,135) (1,787,354) Business combination with Fibria 1,034,842 Tax loss 79,924 (264,955) Tax loss carryforwards 61,934 (23,203) (Reversal)/provision for judicial liabilities 14,955 (1,964) Operating provisions and other losses (85,853) 82,785 Exchange rate variation - Taxation on a cash basis 1,105,061 451,300 Derivative losses 741,851 390,198 Fair value adjustment on business combination – Amortization 682,708 5,327 Unrealized profit 287,397 124,454 Lease (2,794) 69 Adjustment to present value 174 Tax benefit on unamortized goodwill (136,571) (3,098) Property, plant and equipment - Deemed cost 37,552 51,408 Accelerated depreciation 72,552 (13,067) Transaction cost 43,801 (23,145) Other temporary differences (19,702) 4,243 Fair value of biological assets (45,561) (22,307) Tax provision on results of subsidiaries abroad (305,332) Tax credits - gains in tax lawsuit (ICMS from the PIS/COFINS calculation basis) (43,559) Ending balance 2,494,070 (1,029,135)

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

11.1 Reconciliation of the effects of income tax and social contribution on profit or loss

September 30, September 30, 2019 2018

Net income (loss) before taxes (6,285,167) (2,049,698) Income tax and social contribution benefit (expense) at statutory nominal rate of 34% 2,136,957 696,897

Tax effect on permanent differences: (1) Tax incentive - Reduction SUDENE 23,216 158,135 Income from associates and joint ventures (7,224) 1,315 (2) Taxation difference - Subsidiaries 226,218 46,949 Credit related to Reintegra Program 3,342 36,891 Taxation with subsidiaries (presumed profit) (71,715) (23,007) Tax incentives applied to income tax (3) 13,912 Donations / Fines - Other 13,625 (9,582) Director bonus (42,682) 2,295,649 907,600 Income tax Current (187,329) (229,113) Deferred 1,820,631 943,906 1,633,302 714,793 Social Contribution Current (34,663) (191,034) Deferred 697,010 383,841

662,347 192,807

Income and social contribution benefits (expenses) on the period 2,295,649 907,600

Effective rate of income and social contribution tax expenses 36.5% 44.3%

1) Refers to the benefit of reducing 75% of the income tax, based on profits from exploration on the units Mucuri (BA) and Imperatriz (MA).

2) The effect of the difference in taxation of subsidiaries is substantially due to the difference between the nominal rates of Brazil and subsidiaries abroad.

3) Income tax deduction amount referring to the use of the PAT (“Worker Feeding Program”) benefit and donations made in cultural and sports projects.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

12 Biological Assets

The roll forward in the balances of biological assets is set forth below:

Balances on December 31, 2017 4,548,897 Addition 1,285,490 Depletion (709,547) Loss on fair value adjustment (129,187) Disposal (47,124) Other write-offs (12,624) Balances on December 31, 2018 4,935,905 Business combination with Fibria (1) 4,579,526 Addition 2,109,268 Depletion (1,371,895) Gain on fair value adjustment 83,453 Disposal (21,194) Other write-offs (34,096) Balances on September 30, 2019 10,280,967

1) Business combination with Fibria and its subsidiaries held on January 3, 2019, note 1.1.1.

The Company’s biological assets are mainly of eucalyptus forest for reforestation used to supply wood to pulp and paper manufactory facility and are located in the states of São Paulo, Bahia, Espírito Santo, Maranhão, Minas Gerais, Pará, Piauí and Tocantins. Permanent preservation and legal reserve areas were not included in the biological assets fair value measurements due to its nature.

The fair value of eucalyptus forests is determined semiannually through the income approach method by using the discounted cash flow method.

The Company has no biological assets pledged in the nine-month period ended September 30, 2019.

13 Investments

13.1 Investments breakdown

September 30, December 31,

2019 2018

Investments in associates and joint ventures 92,126 14,338 Goodwill 166,820 Other investments evaluated at fair value through other

comprehensive income 20,317 279,263 14,338

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

13.2 Investments in associates and joint ventures

Information of joint ventures as of Company Participation September 30, In the income of the In equity 2019 period Income Participation September December 31, September September Equity of the equity 30, 2019 2018 30, 2019 30, 2018 period (%)

Associate Ensyn Corporation (1) 25.30% 9,214 5,993 Spinnova (1) 24.06% 55,111 (483) 64,325 5,510

Joint ventures Ibema 47,351 30,954 49.90% 23,628 14,338 15,446 8,676 F&E Technologies LLC 8,348 538 50.00% 4,174 269 27,802 14,338 15,715 8,676 92,127 14,338 21,225 8,676

1) Investment by which the Company has had significant influence and, therefore, value by the equity method, note 3.1.5. and 3.1.6.

13.3 Other investments

Percentage of total September 30, December 31,

capital (%) 2019 2018 CelluForce 8.30% 20,317

The change in the consolidated balance is substantially related to the balances arising from the business combination with Fibria in January 2019, as disclosed in note 1.1.

13.4 Business combination with Fibria

To determine the accounting criteria for recording this transaction with Fibria, we observed the provisions of IFRS 3 – Business Combination.

The direct costs related to the operation, recorded directly in general and administrative expenses for the period when incurred, totaled approximately R$96,922, substantially consisting of expenses with legal fees, auditing and other consulting services.

The net assets were evaluated by Management and an independent appraiser was hired to assist in determining their fair values. The methodology adopted for the determination of fair value adjustments on business combination with Fibria is described in note 1.1.1.

Intangibles were evaluated by Management and an independent appraiser was hired to assist in determining the fair values, and some qualified for booking in accordance with IAS 38 – Intangible Assets.

As disclosed in note 1.1, on January 3, 2019, Suzano has acquired the control of Fibria. The assets acquired and liabilities assumed at the fair value are set forth below (in millions of Brazilian Reais):

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Assets Fair value Liabilities Fair value Current Current Cash and cash equivalents 1,795 Loans and financing 3,136 Financial investments 4,316 Derivative financial instruments 276 Derivative financial instruments 211 Lease liabilities 376 Trade accounts receivable 1,302 Trade accounts payable 3,427 Inventories 6,187 Payroll and charges 402 Recoverable taxes 261 Taxes payable 129 Other assets 213 Dividends payable 6 Other liabilities 126 Total current assets 14,285 Total current liabilities 7,878

Non-current Non-current Financial investments 173 Loans and financing 17,591 Derivative financial instruments 455 Lease liabilities 2,599 Recoverable taxes 988 Derivative financial instruments 126 Advances to suppliers 604 Provision for contingencies, net 3,182 Judicial deposits 210 Deferred taxes 558 Deferred taxes 1,567 Other liabilities 251 Other assets 227 4,224 Total non-current liabilities 24,307 Total liabilities 32,185 Investments 200 Biological assets 4,580 Property, plant and equipment 24,961 Right of use 2,916 Intangible assets Other intangible assets 309 Customer portfolio 9,031 Software 21 Cultivars 143 Supplier agreements 172 Equity Port concession 749 Fair value adjustment of lease 44 Shareholders ' equity 37,236 agreements Goodwill 7,897 51,023 Non-controlling interest 111 Total non-current assets 55,247 Total equity 37,347 Total liabilities and shareholders' Total asset 69,532 equity 69,532

During the measurement process of the assets acquired and liabilities assumed at the fair value, the Company has identified adjustments to the fair value of some assets and liabilities, as described below, however there were no changes in the goodwill amount.

(i) An adjustment in the amount of R$ 72 million in the opening balance of the measurement of right of use and lease liabilities. (ii) Reclassification of financing leasing liability in the amount of R$ 142 million to lease liabilities that were previously classified as other liabilities; and (iii) Reclassification of financing leasing assets in the amount of R$ 83 million to lease rights that were previously classified as PP&E.

The net revenue and profit that impacted the consolidated in the nine-month period ended September 30, 2019 were R$10,680,869 and R$286,714, respectively.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

14 Property, Plant and Equipment

Machinery, equipment Work in Lands Buildings and facilities progress Other (1) Total Annual average depreciation rate % 3 5 10 to 20

Cost Balance as of December 31, 2017 4,348,593 2,815,673 15,846,331 483,735 288,395 23,782,727 Additions 705 2,319 143,058 1,321,350 25,913 1,493,345 Fair value adjustment from business combination - Facepa 27,381 (3,014) 27,506 (4,880) 2,821 49,814 Business combination - Facepa 7,446 18,505 46,165 3,395 1,920 77,431 Business combination - PCH 4,291 102,176 3,831 2 26 110,326 Write-offs (34,523) (8,654) (67,280) (1,183) (111,640) Interest capitalization 1,772 1,772 Transfer and other (2) 750,824 131,515 441,420 (1,339,218) 14,199 (1,260) Balance as of December 31, 2018 5,104,717 3,058,520 16,441,031 466,156 332,091 25,402,515 Business combination with Fibria 2,151,338 3,918,552 20,255,811 425,868 454,759 27,206,328 Additions 337,709 1,366 97,517 1,160,337 25,139 1,622,068 Write-offs (76,335) (30,954) (78,223) (1,462) (29,736) (216,710) Fair value adjustment - Fibria 2,637,671 1,502,021 5,109,939 195,684 9,445,315 Fair value adjustment – Facepa (775) 3,847 (428) (111) 2,533 Fair value adjustment – Ibema 5,448 5,448 Transfer and other (2) 179,358 121,898 472,606 (892,570) (81,867) (200,576) Balance as of September 30, 2019 10,334,458 8,570,628 42,307,976 1,157,901 895,959 63,266,921

Depreciation Balance as of December 31, 2017 (829,821) (6,545,959) (195,718) (7,571,498) Write-offs 1,462 60,506 196 62,164 Depreciation (78,264) (760,634) (29,844) (868,742) Fair value adjustment from business combination - Facepa (3,447) (731) (4,178) Transfer and other (2) 7 1,391 (1,398) Balance as of December 31, 2018 (906,616) (7,248,143) (227,495) (8,382,254) Business combination with Fibria (3) (1,804,967) (9,552,825) (249,087) (11,606,879) Write-offs 23,742 51,157 10,164 85,063 Additions (166,024) (1,332,113) (60,503) (1,558,640) Additions - Fair value adjustment from business combination - Fibria (46,435) (408,128) (13,042) (467,605) Fair value adjustment from business combination - Facepa (5,742) (4,988) (95) (10,825) Fair value adjustment from business combination - Ibema (444) (444) Transfer and other (2) (88) 175,445 178 175,535 Balance as of September 30, 2019 (2,906,130) (18,320,039) (539,880) (21,766,049)

Net

Balance as of December 31, 2018 5,104,717 2,151,904 9,192,888 466,156 104,594 17,020,259 Balance as of September 30, 2019 10,334,458 5,664,498 23,987,937 1,157,901 356,079 41,500,872

1) Includes vehicles, furniture and utensils and computer equipment.

2) Includes transfers carried out between the items of property, plant and equipment, intangible assets, right of use arising from lease agreements and inventories.

3) Business combination with Fibria and its subsidiaries held on January 3, 2019, note 1.1.1.

On September 30, 2019, the Company did not identify any event that indicated impairment of property, plant and equipment.

On September 30, 2019, the Company and its subsidiaries had property, plant and equipment as warranty for loan operations and lawsuits, in the amounted of R$ 25,373,335, consisting substantially of the units of Aracruz, Imperatriz, Limeira,

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

Mucuri, Suzano and Três Lagoas (R$ 11,505,386 on December 31, 2018, consisting substantially of the units of Imperatriz, Limeira, Mucuri and Suzano).

15 Intangible Assets

15.1 Goodwill

September 30, December 31, 2019 2018

Vale Florestar 45,435 45,435

Paineiras Logística 10 10

PCHM 307 307

FACEPA 119,333 112,582 (1) Fibria 7,897,051

8,062,136 158,334

1) Purchase price allocation in note 1.1.1.

15.2 Others intangible assets with indefinite useful life

On September 30, 2019 and December 31, 2018, the amount related to other intangible assets with indefinite useful life was R$1,196.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

15.3 Intangible assets with determined useful life

September 30, December 31, 2019 2018 Beginning balance 180,311 141,785 Amounts from the business combination with Fibria (1) 308,681 Additions 12,816 7,983 Fair value adjustment on business combination with 53,477 Facepa Fair value adjustment on business combination with Ibema 702 Amortization (66,897) (44,340) Fair value adjustment on business combination with Fibria 10,159,550 Customer portfolio 9,030,779 Supplier agreements 172,094 Port services agreements 694,590 Port concession 54,470 Lease agreements 44,371 Cultivars 142,744 Software 20,502 Fair value adjustment on business combination with Fibria - Amortization: (717,433) Customer portfolio (615,735) Supplier agreements (54,073) Port services agreements (22,022) Port concession (1,610) Lease agreements (5,624) Cultivars (15,294) Software (3,075) Fair value adjustment on business combination with Facepa - Amortization (11,790) Fair value adjustment on business combination with Ibema - Amortization (18) Exchange rate variation 5,426 12,461 Transfers and others 34,058 8,945 Ending balance 9,905,406 180,311 Average Annual Represented by Amortization Rate % Trademarks and patents 5 to 10 21,455 19,477 Software 20 121,778 59,112 Customer portfolio 2.5 to 5 10,095 19,004 Non-compete agreement 5 2,303 2,812 Research and development agreement 19 79,281 79,906 Development and implementation of systems 20 1,764 Right of exploitation - Terminal concession of Macuco 4 168,858 Supplier Relationship - Chemicals 5 54,141 Others 2,931 Intangible assets (fair value adjustments) acquired in the business combination, net – Fibria 9,442,116 Customer portfolio 9 8,415,044 Supplier agreements 13 to 100 118,021 Port services agreements 4 672,568 Ports concession 4 52,860 Lease agreements 17 38,746 Cultivars 14 127,450 Software 20 17,427 Intangible assets (fair value adjustments) acquired in the business combination, net – Ibema 684

9,905,406 180,311

1) Business combination with Fibria and its subsidiaries held on January 3, 2019, note 1.1.1.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

On September 30, 2019, the Company did not identify any event that indicated impairment of intangible.

16 Trade accounts payable

September 30, December 31, 2019 2018

In local currency Related party (Companies of the Suzano group) 3,419 1,804 Third party 2,393,940 558,041

In foreign currency Third party (1) 953,473 72,720

Fair value adjustments on business combination with Fibria (25,108) 3,325,724 632,565

1) The Company had a take or pay agreement with Klabin S.A., under conditions differentiated in terms of volume, exclusivity, guarantees and payment terms in up to 360 days, and prices were practiced under conditions of contractually established. Following the requirements imposed by the European Union's competition authority, the contract with Klabin expired in July 2019. As of September 30, 2019, the amount of R$ 755.309 in the consolidated refers to purchases of Klabin's pulp.

The change in the consolidated balance is mainly related to the balances arising from the business combination with Fibria in January 2019, as disclosed in note 1.1.1.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

17 Loans, financing and debentures

17.1 Breakdown of the accounting balances by type

Current Non-current Total Average Interest annual rate interest September 30, December 31, September 30, December 31, September 30, December 31, Type rate - % 2019 2018 2019 2018 2019 2018 In foreign currency BNDES UMBNDES 6.6 27,864 21,577 34,439 139,940 62,303 161,517 Bonds Fixed 5.7 323,168 216,624 28,281,429 11,189,403 28,604,597 11,406,027 Syndicated loan Libor 2. 7 31,730 37,546 12,673,982 11,787,588 12,705,712 11,825,134 Finnvera/EKN (“Export Credit Agencies”) Libor 236,385 560,689 797,074 Financial lease U.S.$ 5,608 12,617 18,225 Export credits (ACC - pre-payment) Libor/Fixed 4. 1 2,088,937 1,896,717 3,281,010 274,673 5,369,947 2,171,390 2,471,699 2,414,457 44,270,860 23,964,910 46,742,559 26,379,367

In local currency BNDES TJLP 8.2 278,137 28,867 1,586,541 183,269 1,864,678 212,136 BNDES TLP 8.1 8,120 97,827 105,947 BNDES Fixed 5.2 43,149 26,119 85,474 95,034 128,623 121,153 BNDES SELIC 5.9 76,112 728,447 804,559 FINAME Fixed 6.6 4,815 970 15,193 2,010 20,008 2,980 BNB Fixed 6.6 32,733 25,038 165,673 191,976 198,406 217,014 CRA (“Agribusiness Receivables Certificates”) CDI/IPCA 6.4 1,900,423 789,892 3,951,197 1,588,986 5,851,620 2,378,878 Export credit note CDI 6.6 109,321 93,001 1,268,392 1,327,378 1,377,713 1,420,379 Rural producer Certificate CDI 7.6 1,406 6,809 273,234 273,029 274,640 279,838 Export credits (“Pre payment”) Fixed 8.1 50,547 1,312,318 1,362,865 FCO (“Central West Fund”), FDCO (“Central West Fixed 8.0 Development Fund”) and FINEP 88,628 7,725 509,969 5,135 598,597 12,860 Others (Revolving Cost, Working capital and FDI) Fixed 10.1 4,593 10,467 16,930 4,593 27,397 FDIC Funds of credit rights (Note 7.1) Fixed 0.4 8,704 22,054 8,704 22,054 Fair value adjustment on business combination with Fibria (68,586) (68,586) Debentures CDI 7. 6 81,435 1,297 4,664,182 4,662,156 4,745,617 4,663,453 2,619,537 1,012,239 14,658,447 8,345,903 17,277,984 9,358,142 5,091,236 3,426,696 58,929,307 32,310,813 64,020,543 35,737,509

Interest on financing 704,516 345,988 128,433 832,949 345,988 Non-current funding 4,386,720 3,080,708 58,800,874 32,310,813 63,187,594 35,391,521 5,091,236 3,426,696 58,929,307 32,310,813 64,020,543 35,737,509

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

17.2 Changes in loans, financing and debentures

September 30, December 31, 2019 2018

Beginning balance 35,737,509 12,191,856 (1) Amounts from the business combination with Fibria 20,667,096 (2) Reclassification - accounts payable from lease operations (18,225)

Fundraising 16,315,910 25,539,994

Addition to loans – PCH / FACEPA 79,923

Interest accrued 2,530,500 839,278

Exchange rate variation, net 3,290,597 1,457,989

Settlement of principal (12,249,522) (3,738,577)

Settlement of interest (2,362,331) (669,088)

Fair value adjustment on business combination with Fibria (68,586) Amortization of fundraising costs 172,803 36,134

Others 4,792

Ending balance 64,020,543 35,737,509

1) Business combination with Fibria its subsidiaries held on January 3, 2019, note 1.1.1.

2) As of January 1, 2019, the lease balance was reclassified to "Accounts payable from lease operations", due to adoption of IFRS 16 by the Company.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

17.3 Breakdown by maturity – non current

2020 2021 2022 2023 2024 2025 2026 2027 Total onwards In foreign currency BNDES - Currency basket 6,156 9,466 10,381 8,436 34,439 Bonds 789,695 2,481,192 2,456,626 2,915,080 19,638,835 28,281,428

Syndicated Loan 1,388,133 3,303,757 7,982,092 12,673,982

Export credits (ACC pre-payment) 13,633 140,841 13,569 2,082,200 1,030,769 3,281,012

19,789 2,328,135 3,327,707 7,990,528 4,563,392 3,487,395 2,915,080 19,638,835 44,270,861

In local currency BNDES – TJLP 68,875 269,506 265,380 266,552 239,884 292,573 169,102 14,668 1,586,540 BNDES – TLP 3,134 12,535 12,535 12,535 12,535 11,869 21,149 11,535 97,827 BNDES – Fixed 8,853 28,959 24,567 18,611 4,484 85,474 BNDES – Selic 19,132 75,158 72,381 95,106 87,240 207,782 171,649 728,448 FINAME 960 3,829 2,786 1,656 1,198 4,764 15,193 BNB 8,821 35,285 33,201 35,285 33,201 10,285 9,595 165,673 CRA (“Agribusiness Receivables Certificates”) 1,000,000 1,512,680 1,438,517 3,951,197 Export credit note 640,800 627,592 1,268,392 Rural producer certificate 137,500 135,734 273,234 Export credits (“Pre payment”) 1,312,318 1,312,318 FCO (“Central West Fund”), FDCO (“Central West Development Fund”) and FINEP 34,064 67,986 67,986 67,986 67,986 67,986 67,986 67,988 509,968 Debentures 2,340,550 2,323,632 4,664,182

1,143,839 493,258 1,991,516 1,936,248 1,758,846 3,714,109 3,526,439 94,191 14,658,446

1,163,628 2,821,393 5,319,223 9,926,776 6,322,238 7,201,504 6 , 441 ,519 19,733,026 58,929,307

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

17.4 Breakdown by currency

September 30, December 31, 2019 2018

Brazilian Reais 16,473,425 9,358,142

U.S. Dollar 46,680,256 26,217,850 Selic (1) 804,559

Currency basket 62,303 161,517

64,020,543 35,737,509

1) Contractual definition of currency in contracts with Brazilian National Bank for Economic and Social Development (“Banco Nacional de Desenvolvimento Econômico e Social or “BNDES”) that are in Brazilian Reais plus SELIC interest.

17.5 Transaction costs and premiums of securities issues

The fundraising costs are amortized on the contractual dates based on the effective interest rate.

Balance to be amortized Nature Total cost Amortization September 30, December 31, 2019 2018 Bonds 343,642 129,297 214,345 67,189 CRA and NCE 125,222 73,508 51,714 20,195 Import (“ECA”) 101,811 101,811 16,235 Syndicated Loan 72,774 33,209 39,565 30,552 Debentures 21,592 4,674 16,918 18,944 BNDES (“IOF”) (1) 53,730 13,702 40,028 Others 18,147 8,381 9,766 3,188

736,918 364,582 372,336 156,303

1) Tax on Financial Operations

17.6 Relevant operations settled in the period

17.6.1 Early settlement of CRA’s

On January 3, 2019, the Company settled in advance, through its wholly-owned subsidiary Fibria, the amount of R$ 878,573 of two series of CRA’s, with original maturities in 2021 and 2023 and a cost of 99% of CDI and IPCA + 4.5055% p.a. This settlement refers to the two of the nine series that were not obtained prior approval of the holders of the Certificates for the business combination between the Companies.

17.6.2 BNDES

On March 15, 2019, the Company carried out the early amortization of R$ 299,682 with the BNDES, comprising an installment to be amortized from the balance of the outstanding debt plus the corresponding remuneration up to the payment date.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

17.6.3 Export prepayment ("PPE")

On June 17, 2019, the Company, through its subsidiary Suzano International Trade GmbH (former Fibria International Trade GmbH), voluntarily prepaid the amount of U.S.$ 631,138 (equivalent to R$ 2,454,443), related to an export prepayment agreement, with quarterly interest payments of 1.15% p.a. plus quarterly LIBOR, which was scheduled to mature in 2022.

On June 18, 2019, the Company, through its subsidiary Suzano International Trade GmbH (former Fibria International Trade GmbH, voluntarily prepaid the amount of U.S.$ 156,032 (equivalent to R$ 602,410), related to an export prepayment agreement, with quarterly interest payments of 1.15% p.a. plus quarterly LIBOR, which was scheduled to mature in October 2022.

17.6.4 Finnvera

On April 29 and April 30, 2019, the Company voluntarily prepaid U.S.$ 208,400 (equivalent to R$ 822,200) related to certain financing agreements that were guaranteed by the export credit agencies Finnvera and EKN.

On June 17, 2019, the Company voluntarily prepaid the outstanding amount of U.S.$378,471 (equivalent to R$1,473,114) related to certain financing agreements that were guaranteed by the export credit agency Finnvera initially contracted in May 2016, which maturity date was 2025.

17.7 Relevant operations contracted in the period

17.7.1 Senior Notes (“Notes 2029”)

On January 29, 2019, the Company reopened Senior Notes 2029 with the additional issue of debt securities in the amount of U.S.$ 750,000 (equivalent to R$ 2,874,150). The notes mature in January 2029 and were issued with interest of 5.465% p.a., which will be paid semi-annually.

17.7.2 Export prepayment contracts ("PPE")

On February 25, 2019, the Company entered into an export prepayment agreement in the amount of R$ 738,800, with annual interest payment of 8.35% p.a. and maturing in 2024.

On June 14, 2019, the Company, through its wholly-owned subsidiary Fibria International Trade GmbH, entered into a syndicated export prepayment transaction in the amount of U.S.$ 750,000 (equivalent to R$ 2,910,975), with a term of six years and grace period of five years. Suzano is the guarantor of the transaction.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

On June 14, 2019, the Company entered into an export prepayment agreement in the amount of R$ 578,400, with annual interest payment of 7.70% p.a. and maturing in 2024.

17.7.3 Senior Notes ("Notes 2047")

On May 21, 2019, the Company, through its subsidiary Suzano Austria GmbH issued an additional amount of U.S.$ 250,000 (equivalent to R$ 1,020,250) of its 7.000% Senior Notes due 2047, with yield at the rate of 6.245% p.a. and coupon at the rate of 7.0% p.a., to be paid semiannually, in March and September, with maturity on March 16, 2047. This operation is fully guaranteed by Suzano S.A.

17.7.4 Senior Notes ("Notes 2030")

On May 21, 2019, the Company, through its subsidiary Suzano Austria issued an aggregate amount of U.S.$ 1,000,000 (equivalent to R$ 4,081,000) of 5.000% Senior Notes due 2030, with yield at the rate of 5.180% p.a. and coupon at the rate of 5.0% p.a., to be paid semiannually, in January and July, with maturity on January 15, 2030. This operation is fully guaranteed by Suzano S.A.

17.7.5 BNDES

On May 17, 2019, BNDES has released funds to the Company in the amount of R$ 108,050, with interest rates varying from Long Term Rate (“TLP”) plus interest rate of 0.96% p.a. to 1.44% p.a. to be paid from 2020 to 2028. The resources were applied to projects in the industrial, social and technological innovation areas.

17.7.6 Debentures

On January 7, 2019, the Company issued R$ 4,000,000 in 7th issue, single series, non- convertible shares, due in January 2020 and with interest rates of 103% up to 112% of the CDI rate.

On March 27, 2019, the Company made the partial optional extraordinary amortization on the balance of the nominal unit value of all the debentures of this 7th issue, upon payment of the total amount of R$ 2,056,173, comprising an installment to be amortized balance of the nominal unit value of all debentures plus the corresponding remuneration.

On May 31, 2019, the Company redeemed in full its unsecured debentures of its 7th issuance, non-convertible into shares, with maturity on January 7, 2020, by paying the total outstanding amount of R$ 2,019,587, comprising the total balance of the face value per unit of the totality of the debentures of such issuance plus the corresponding remuneration.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

18 Lease operations

18.1 Right of use on lease agreements

As described in note 3.1.1, the Company adopted IFRS 16 and applied the IFRS retrospectively with the cumulative effect of adoption recorded at the date of initial application. Accordingly, comparative periods were not restated.

On January 1, 2019, the amounts corresponding to the right to use the current agreements were recognized, in amounts equivalent to the present value of the obligations assumed with the counterparties. The amortization of these balances will occur according to the terms defined for the leases. Except for land agreements that are automatically extended for the same period by means of notification to the lessor, for the other agreements are not allowed automatic renewals and for an indefinite period, as well as the exercise of termination is a right of both parties.

The Company does not have lease agreements with clauses of (a) variable payments that are based on the performance of the leased assets (ii) guarantee of residual value (iii) restrictions, such as, for example, obligation to maintain financial ratios.

In addition, the Company recognized under right of use the residual value of the right to use the agreements previously classified as financial leases under IAS 17 and which were recognized in the Property, plant and equipment group until December 31, 2018, being reclassified the amount of R$ 89,338 in the initial adoption.

The effect of its adoption of the balances for the nine-month period ended September 30, 2019 is set forth below:

Lands and Machines and Ships and Farms Equipment’s Buildings boats Vehicles Total Balance as of December 31, 2018 Initial adoption on January 1, 2019 2,072,923 168,949 48,879 1,656,322 1,190 3,948,263 Additions 117,968 1,194 34,583 549,890 703,635 Amortization (1) (175,486) (11,579) (22,786) (81,446) (694) (291,991) Balance as of September 30, 2019 2,015,405 158,564 60,676 2,124,766 496 4,359,907

1) The amount of R$ 185,066 is reclassified to biological assets to compose the formation cost.

For the nine-month period ended September 30, 2019, the Company is committed to lease agreements not yet in force for ships expected to be delivered one unit in first quarter 2019 and one unit in first quarter 2020.

18.2 Lease liabilities

At the adoption of IFRS 16, the Company recognized lease liabilities for the current agreements, and which were previously classified as operating leases in accordance with IAS 17 - Leasing Operations, except for agreements included in the practical expedient permitted by the standard and adopted by the Company, as described in note 3.1.1.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

The liabilities recognized as of January 1, 2019 correspond to the remaining balances payable of the lease contracts, measured to present value by the discount rates on the date of their adoption.

In addition, the Company recognized under lease liabilities the remaining balances of agreements previously classified as financial leases under IAS 17 and which were recognized in the group of loans and financing until December 31, 2018, being reclassified the amount of R$ 18,225 in the initial adoption, as set forth below:

Average rate - % Present value of (1) Nature of agreement per annual Maturity (2) liabilities

Lands and farms 6.21 November 2046 2,072,923 Machines and Equipment’s 4.92 July 2032 239,995 Buildings 6.46 April 2027 48,880 Ships and boats 6.45 February 2039 1,656,322 Vehicles 6.05 April 2020 1,190 4,019,310

1) To determine the discount rates, quotes were obtained from financial institutions for agreements with characteristics and average terms similar to the lease agreements.

2) Refers to the original maturities of the agreements and, therefore, do not consider eventual renewal clause.

The changes in the balances for the nine-month period ended September 30, 2019 are as follows:

Balance as of December 31, 2018 Initial adoption on January 1, 2019 4,019,310 Additions 703,480 Payments (425,297) Appropriation of financial charges (1) 192,277 Exchange rate variation 44,614 Balance as of September 30, 2019 4,534,384

Current 587,910 Non-current 3,946,474

1) The amount of R$ 39,216 is reclassified to biological assets to compose the formation cost.

The maturity schedule of future payment not discounted to present value related to lease liabilities is disclosed in note 4.2.

18.2.1 Discount rate

The discount rates applied on new lease agreements for nine-month ended September 30, 2019 are similar to those applied on adoption of IFRS 16.

18.2.2 Amounts recognized in the statement of income for the period

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

In the nine-month period ended September 30, 2019, were recognized the amounts:

Expenses relating to short-term assets 37,263 Expenses relating to low-value assets 8,293 45,556

18.2.3 Reconciliation of operating lease commitments

Operating lease commitments disclosed as of December 31, 2018 1,448,241 Business combination with Fibria 2,974,729 Discounted through a lessee’s incremental loan rate at initial adoption (421,313) Reclassification from loans and financing (1) 18,225 Agreements revalued as service agreements (572) 4,019,310

1) As of January 1, 2019, the lease balance was reclassified from "Loans and financing", due to adoption of IFRS 16 by the Company note 17.2.

19 Provision for judicial liabilities

19.1 Changes in provisions for judicial liabilities

September 30, December 31, 2019 2018

Beginning balance 351,270 317,069 (1) Business combination with Fibria 211,294

Settlement (25,655) (41,011)

Reversal of processes (35,593) (19,010)

New processes 17,141 80,520 Judicial deposits - Changes (16,089)

Monetary adjustment 33,459 13,702 (2) Fair value adjustment on business combination with Fibria 2,959,620

Ending balance 3,495,447 351,270

1) Business combination with Fibria its subsidiaries held on January 3, 2019, note 1.1.1.

2) Corresponds to the fair value adjustment on business combination with Fibria attributed to legal liabilities classified as possible and remote losses of Fibria, in the amounts of R$2,980,627 and R$50,993, respectively.

During the nine-month period ended September 30, 2019, there were no material changes in the lawsuits in progress or decisions affecting the Company in relation to these lawsuits.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

19.2 Lawsuits possible

The Company is involved in tax, civil and labor lawsuits, that are not provisioned since they involve risk with probability of loss classified by Management and by its legal advisors as possible:

September 30, December 31, 2019 2018 Taxes and Social Security (1) 6,855,904 1,077,761 Labor 202,085 85,309 Civil (1) 2,474,649 43,271 9,532,638 1,206,341

1) Amounts net of the fair value adjustment on business combination with Fibria related to possible contingencies, as mentioned above.

The change in the balance refers to the lawsuits in progress arising from the business combination with Fibria, whose nature of the main causes were disclosed in its latest condensed consolidated financial information as of December 31, 2018.

20 Employee benefits

20.1 Defined benefits plan

The Company guarantees coverage of healthcare costs for former employees who retired by 2003 (until 1998 for former employees of Ripasa, current Limeira unit and until 2007 for former employees of the Jacareí unit), as well as their spouses for life and dependents while they are minors.

For other group of former employees, who exceptionally, according to the Company’s criteria and resolution or according with rights related to the compliance with pertinent legislation, the Company ensures the healthcare program.

The Company offers life insurance benefit provided to retirees.

20.2 Changes in employee benefits

Balance at December 31, 2017 351,263 Interest on employee benefits 35,920 Actuarial loss 69,305 Benefits paid in the year (26,061) Balance at December 31, 2018 430,427 Business combination with Fibria (1) 147,877 Interest on employee benefits 38,762 Benefits paid in the period (24,599) Balance on September 30, 2019 592,467

1) Business combination with Fibria its subsidiaries held on January 3, 2019, note 1.1.1.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

21 Share-Based Compensation Plans

On September 30, 2019, the Company had two share-based, long-term compensation plans: i) Phantom stock option plan (“Phantom Shares - “PS”) and ii) Share Appreciation Rights (“SAR”), both paid in local currency.

These plans did not undergo any changes in their characteristics and measurement criteria since the financial statements of December 31, 2018.

21.1 Phantom stock option plan

September 30, December 31, 2019 2018 Number of Number of shares shares

Beginning balance 5,045,357 5,055,519 Granted during of the period 2,153,822 1,415,476 Exercised (1) (240,954) (751,859) Exercised due to dismissal (1) (106,983) (153,601) Abandoned / prescribed due to dismissal (448,523) (520,178) Ending balance 6,402,719 5,045,357

1) For share options exercised and those exercised due to termination of employment, the average price on September 30, 2019 and December 31, 2018 was R$38.03 and R$47.77, respectively.

21.2 Common stock plan

Restricted period Deadline for the options Price on Shares for transfer of Program Date of grant to become exercisable grant date Granted shares

Program 4 01/02/2018 01/02/2019 R$39.10 130,435 01/02/2022

Additionally, in 2019 the Company established a Restricted Shares plan based on the Company's performance (Program 5). The Plan associates the quantity of Restricted Shares granted to the Company's performance in relation to the EBITDA mark. The quantity of the restricted stock granted is defined in financial terms and is subsequently converted into shares based on the last 60 stock exchange trading days on December 31, 2019 of SUZB3 at B3.

After measurement of 2019 EBITDA, the Restricted Shares will be granted immediately, as they not have to comply to the vesting period. However, the beneficiaries of the grant must comply to the lockup period of thirty-six (36) months during which they will not be able to market the shares.

In the event that the beneficiaries leave the Company before the end of the fiscal year for the measurement of EBITDA, they will lose the right to the grant of Restricted Share.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

21.3 Equity and income statement balances

The amounts corresponding to the services received and recognized in the interim financial information are set forth below:

Liabilities and equity Income Statement September 30, December 31, September 30, September 30, 2019 2018 2019 2018

Non-current liabilities

Provision for phantom stock plan 126,425 124,318 (13,875) (117,708)

Shareholders' equity

Stock option reserve 9,056 5,100 (3,956) (72) Total general and administrative expenses from share-based transactions (17,831) (117,780)

22 Shareholders' Equity

22.1 Share capital

In January 2019, the Company's share capital was increased in the amount of R$ 3,027,528, with the issuance of 255,437,439 registered common shares, with no par value, in accordance with resolutions adopted at the Extraordinary Shareholders’ Meeting, which the incorporation by the Company its subsidiary Eucalipto Holding S.A. was approved in connection with the business combination with Fibria, as described in note 1.1.1.

On September 30, 2019, the share capital of Suzano is R$ 9,269,281 divided into 1,361,263,584 common shares, all nominative, book-entry shares without par value. The value of the share capital is net of the public offering expenses of R$ 33,735.

The breakdown of the share capital is set forth:

Ordinary Shareholder Quantity (%) Controlling Shareholders Suzano Holding S.A. 367,612,329 27.01 Controller 194,800,797 14.31 Managements 35,532,742 2.61 Alden Fundo de Investimento em Ações 26,154,741 1.92 624,100,609 45.85 Treasury 12,042,004 0.88 BNDESPAR 150,217,425 11.04 Votorantim S.A. 75,180,059 5.52 Other shareholders 499,723,487 36.71 1,361,263,584 100.00

By resolution of the Board of Directors, the share capital may be increased, irrespective of any amendment to the Bylaws, up to the limit of 780,119,712 common shares, all exclusively book-entry shares.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

On September 30, 2019, SUZB3 common shares ended the period quoted at R$33.65 (R$38.08 on December 31, 2018).

22.2 Dividends

On April 18, 2019, on Ordinary Shareholders’ Meeting was approved a payment of dividends in the amount of R$ 600,000, being complementary in the amount of R$ 596,534 paid through the reserve of profits and minimum mandatory dividends in the amount of R$ 3,466, the disbursement occurred on April 30, 2019.

23 Earnings (loss) per share

23.1 Basic

The basic (loss) earnings per share is measured by dividing the profit attributable to the Company’s shareholders by the weighted average common shares issued during the period, excluding the common shares acquired by the Company and held as treasury shares.

September 30, September 30, 2019 2018

Resulted of the period attributed to controlling shareholders (3,987,065) (1,142,856)

Weighted average number of shares in the period 1,361,264 1,105,826

Weighted average treasury shares (12,042) (12,431)

Weighted average number of outstanding shares 1,349,222 1,093,395

Basic loss per common share - R$ (2.95508) (1.04524)

23.2 Diluted

The diluted earnings per share is measured by adjusting the weighted average of outstanding common shares, assuming the conversion of all common shares that would cause dilution.

September 30, September 30, 2019 2018

Resulted of the period attributed to controlling shareholders (3,987,065) (1,142,856) Weighted average number of shares in the period (except treasury shares) 1,349,222 1,093,395

Weighted average number of shares (diluted) 1,349,222 1,093,395

Diluted loss per common share - R$ (2.95508) (1.04524)

Due to the loss in the period, the Company does not consider the dilution effect in the measurement.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

24 Net Financial Result

September 30, September 30, 2019 2018 Financial expenses (1) Interest on loans, financing and debentures (2,528,303) (629,466)

Amortization of fundraising costs (172,803) (31,674)

Other financial expenses (454,650) (374,032)

Amortization of fair value adjustment on business combination with Fibria 31,985

(3,123,771) (1,035,172)

Financial income Financial investments 305,174 206,962 Other financial income 50,788 8,494 Amortization of fair value adjustment on business combination with Fibria 37,412

393,374 215,456

Income from derivative financial instruments Income 3,240,620 321,017 Expenses (5,477,524) (4,169,556)

(2,236,904) (3,848,539)

Monetary and exchange rate variation, net Exchange rate variation on loans, financing and debentures (3,286,253) (1,743,817) Monetary and exchange rate variations - other assets and liabilities (2) (96,801) 322,103

(3,383,054) (1,421,714)

(8,350,355) (6,089,969)

1) Not include the amount of R$2,952 arising from capitalized interest in the nine-month period ended on September 30, 2019 (R$536 in the nine-month period ended on September 30, 2018). Additionally, included the amount of R$754 related to interest of FIDC (R$ 1,791 in the nine-month period ended on September 30, 2018).

2) Includes effects of exchange rate variations of customers, suppliers, cash and cash equivalents, financial investments and others.

25 Net Sales Revenue

September 30, September 30, 2019 2018

Gross sales 22,904,748 11,207,225

Deductions:

Adjustment to present value (5,316) (3,421)

Returns and cancelations (73,720) (49,381)

Discounts and rebates (2,814,413) (7,867)

20,011,299 11,146,556

Taxes on sales (1) (1,047,309) (932,331)

Net sales revenue 18,963,990 10,214,225

1) In 2018, included the social contribution to the National Institute of Social Security (“INSS”), which represents 2.5% of the gross sales revenue in the domestic market. This is a tax obligation pursuant to Law n°12.546/11, article 8, Appendix I and their respective amendments.

The change in the consolidated balance is mainly related to the effect of Fibria's operations as of January 1, 2019.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

26 Information by Segment and Geographic Areas

26.1 Criteria for identifying operating segments

The Company evaluates the performance of its business segments through the operating result. The information disclosed under “Not Segmented” is related to income statement and balance sheet items not directly attributed to the pulp and paper segments, such as, net financial result and income and social contribution taxes expenses, in addition to the balance sheet classification items of assets and liabilities.

The operating segments defined by Management are as follows:

i) Pulp: comprises production and sale of hardwood eucalyptus pulp and fluff pulp mainly to supply the foreign market, with any surplus sold in the domestic market.

ii) Paper: comprises production and sale of paper to meet the demands of both domestic and foreign markets. Consumer goods (tissue) sales are classified under this segment due to its immateriality.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

26.2 Information on operating segments

September 30, 2019

Not Pulp Paper segmented Total Net sales revenue 15,395,971 3,568,019 18,963,990 Domestic market (Brazil) 1,432,137 2,465,823 3,897,960 Foreign market 13,963,834 1,102,196 15,066,030 Asia 6,804,036 101,856 6,905,892 Europe 4,506,430 155,685 4,662,115 North America 2,617,286 317,250 2,934,536 South and Central America 36,082 496,284 532,366 Africa 31,121 31,121 Cost of sales (12,581,007) (2,352,419) (14,933,426) Gross profit 2,814,964 1,215,600 4,030,564 Gross margin (%) 18.3% 34.1% 21.3%

Operating income (expenses) (1,532,136) (561,355) 128,115 (1,965,376) Selling (1,084,740) (282,558) (1,367,298) General and administrative (606,419) (281,353) (887,772) Other operating, net 153,222 (12,890) 128,115 268,447 Income from associates and joint ventures 5,801 15,446 21,247

Operating profit before net financial income (“EBIT”) (1) 1,282,828 654,245 128,115 2,065,188 Operating margin (%) 8.3% 18.3% 10.9%

Financial result, net (8,350,355) (8,350,355) Net income (loss) before taxes 1,282,828 654,245 (8,222,240) (6,285,167)

Income taxes 2,295,649 2,295,649

Net income (loss) for the period 1,282,828 654,245 (5,926,591) (3,989,518) Profit (loss) margin for the period (%) 8.3% 18.3% (21.0)% Result of the period attributable to controlling shareholders 1,282,828 654,245 (5,924,138) (3,987,065) Result of the period attributed to non-controlling shareholders (2,453) (2,453)

Depreciation, depletion and amortization 5,936,578 376,504 6,313,082

Products sold (in tons) 6,492,134 887,811 7,379,945 Foreign market 5,881,145 291,749 6,172,894 Domestic market (Brazil) 610,989 596,062 1,207,051

1) Earnings before interest and tax.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

September 30, 2018 Not Pulp Paper segmented Total Net sales revenue 6,920,649 3,293,576 10,214,225 Domestic market (Brazil) 524,341 2,328,999 2,853,340 Foreign market 6,396,308 964,577 7,360,885 Asia 3,108,361 80,173 3,188,534 Europe 2,259,516 162,527 2,422,043 North America 993,779 137,098 1,130,877 South and Central America 34,652 556,744 591,396 Africa 28,035 28,035 Cost of sales (3,114,369) (2,117,203) (5,231,572) Gross profit 3,806,281 1,176,372 4,982,653 Gross margin (%) 55.0 % 35.7 % 48.8 %

Operating income (expenses) (305,889) (636,494) (942,382) Selling expenses (158,253) (274,997) (433,250) General and administrative expenses (183,105) (366,491) (549,596) Other operating income (expenses), net 35,470 1,127 36,597 Income from associates and joint ventures 3,867 3,867

Operating profit before net financial income (1) 3,500,392 539,878 4,040,271 Operating margin (%) 50.6 % 16.4 % 39.6 % Financial result, net (6,089,969) (6,089,969) Net income (loss) before taxes 3,500,392 539,878 (6,089,969) (2,049,698) Income taxes 907,600 907,600

Net income (loss) for the period 3,500,392 539,878 (5,182,369) (1,142,098) Profit margin for the period (%) 50.6 % 16.4 % (11.2) % Result of the period attributable to controlling shareholders 3,500,392 539,878 (5,183,126) (1,142,856) Result of the period attributed to non-controlling shareholders 758 758

Depreciation, depletion and amortization 830,178 345,094 1,175,272

Products sold (in tons) 2,580,649 905,377 3,486,026 Foreign market 2,359,652 274,244 2,633,896 Domestic market (Brazil) 220,997 631,134 852,131

1) Earnings before interest and tax.

26.3 Net sales by product

The following table set forth the breakdown of consolidated net sales by product:

September 30, September 30, Products 2019 2018 Market pulp (1) 15,395,971 6,920,650 Printing and writing paper (2) 2,934,497 2,694,177 Paperboard 592,891 548,142 Other 40,631 51,256 Net sales 18,963,990 10,214,225

1) Revenue from fluff pulp represents (around 0.6% of total net sales) and, therefore, was included in market pulp sales.

2) Tissue is a recently launched product and its revenues represent less than 2.2% of total net sales. Therefore, it was included in the sales of printing and writing paper.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

27 Expenses by Nature

September 30, September 30, 2019 2018 (1) Cost of sales

Personnel expenses (1,035,211) (471,023)

Variable cost (5,485,017) (2,406,689)

Logistics cost (2,004,928) (777,669)

Depreciation, depletion and amortization (2,879,996) (1,146,740) Amortization of fair value adjustment on business combination with Fibria

and Facepa (2,706,095)

Other (822,179) (429,451)

(14,933,426) (5,231,572)

Selling expenses Personnel expenses (148,498) (102,933) Services (61,010) (62,275) Logistics cost (385,757) (216,334) Depreciation and amortization (57,435) (3,302) Amortization of fair value adjustment on business combination with Fibria (614,030) Other (2) (100,568) (48,406) (1,367,298) (433,250)

General and Administrative expenses Personnel expenses (485,076) (340,625) Services (226,002) (116,927) Depreciation and amortization (38,496) (25,230) Amortization of fair value adjustment on business combination with Fibria 5,173 Other (3) (143,371) (66,814) (887,772) (549,596)

Other operating (expenses) income net Rents and leases 1,832 Result from sale of other products, net (4) 20,113 3,090 Result from sale and disposal of property, plant and equipment and biological assets, net (52,776) (17,437) Result on fair value adjustment of biological assets 83,453 5,954 Amortization of intangible assets (6,055) (5,611) Insurance reimbursement 6,589 Provision for loss of judicial deposits (3,284) Amortization of fair value adjustment on business combination with Fibria, Facepa and Ibema (12,022) Sale of legal credits 87,000 51,846 Tax credits - gains in tax lawsuit (ICMS from the PIS/COFINS calculation basis) (5) 128,115 Other operating income (expenses), net 15,482 (1,245)

268,447 36,597

1) Includes the amount of R$516,397, related to idle capacity and maintenance downtime.

2) Includes expected credit losses, insurance, materials of use and consumption, expenses with travel, accommodation, participation in trade fairs and events.

3) Includes corporate expenses, insurance, materials of use and consumption social projects and donations, expenses with travel and accommodation.

4) Includes depletion from wood sold in the amount of R$4,126 (On September 30, R$7,277).

5) For further information see note 9.

Suzano S.A.

Notes to the unaudited condensed consolidated interim financial information as of September 30, 2019

(In thousands of R$, unless otherwise stated)

28 Explanatory notes not disclosed

The Company disclosed explanatory notes to the annual financial statements detailing the financial instruments, advances to suppliers, the tax amnesty and refinancing program, asset retirement obligations, long term commitments, shareholders’ equity, benefits to employees, compensation program based on shares, accounts payable with acquisition of assets and subsidiaries, insurance, and impairment testing, that we omitted in the September 30, 2019 consolidated interim financial information because the assumptions, operations and policies have not seen any relevant changes compared to the position disclosed in the financial statements as at December 31, 2018.

29 Subsequent events

29.1 Debenture Issuance – Single Serie

On October 17, 2019, the Company announced to the market a debentures issuance, not-convertible into shares, unsecured, single serie, in the amount of R$ 750,000, with maturity date on September 15, 2028 and interest rate of 100% of CDI plus spread of 1.20% p.a.